All eyes will be on Apple’s results later Tuesday with investors anxious to hear how many new phones were sold by the world’s most profitable company, and its guidance for the current quarter.
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The kiwi initially dropped after the Federal Open Market Committee left interest rates unchanged following a two-day meeting, while dropping reference to concern about recent global economic factors pushing down inflation, and was more upbeat in its assessment of household spending and business investment.
European shares fell following a profit warning from BASF.
“We’ve had this significant move off the lows off August but we’re right back hitting resistance so there is no reason to take it higher at the moment until they get a better feel for what Janet (Yellen) is going to say tomorrow”. The futures market implied traders see only a 7 percent chance of a rate hike on Wednesday and a 34 percent probability of a rate increase at its next meeting in December, according to the CME FedWatch program.
While the Fed is mulling when to raise interest rates, European Central Bank president Mario Draghi last week gave a clear nod to further stimulus coming soon and China’s central bank cut interest rates for the sixth time in less than a year.
The Australian dollar fell more than 1% to as low as $0.7109 Wednesday after disappointing Australian inflation data boosted expectations that the central bank may cut interest rates at its meeting next week. The dollar index, which tracks the U.S. unit against a basket of six rival currencies, was down about 0.2 percent at 96.691.
The yen edged up ahead of a Bank of Japan policy meeting this week where it faces pressure to unveil fresh stimulus following a string of below-par economics data.
“Classic risk assets are all slightly softer, but it’s not been an aggressive move”, he said.
The stronger dollar accounts for about 0.5 percentage points of this drag, a phenomenon that will persist beyond this year and peak in the early part of 2016, Deutsche said.
The yen gained 0.5 per cent to 120.46 per dollar as of 5pm New York time, after rising 0.3 per cent Monday. Twitter reports after markets close as well.
“We experienced a pronounced summer lull and no volume momentum in September”.
And research by JP Morgan economists into previous episodes where emerging market borrowing has soared shows that growth in these countries always suffers when the debt bubble – largely a dollar-borrowing one – deflates.
World stocks and the dollar dipped on Tuesday, as investors locked in a few of the sharp gains seen over the last month ahead of the Federal Reserve’s policy meeting and results from gadget giant Apple.
Oil prices extended losses into a third week. US natural gas has sunk 30 percent in 2015.
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Three-month copper was up a touch at $5,226 a tonne, while safe-haven gold climbed to $1,165 an ounce to end three days of falls.
