Asian session review: NZD sold as RBNZ announces downside risks for interest rates

The Australian dollar rose onpositive data from Australia. According to the data released on Thursday, the number of approved housing loans in September increased by 1.6% compared with August. The surveyed economists had expected a decrease of 1.6%. The volume of approved housing loans in September rose by 4.6% compared with August. This means that lower interest rates provide some support for the housing market.

In addition, the strengthening of commodity prices also supported the Australian dollar. Iron ore prices on Wednesday rose 4.7%, to highs since the beginning of last year. Price of iron ore increased by 3.20 US dollars to 71 US dollars.

New Zealand's dollar fell after the Reserve Bank of New Zealand decided to reduce the interest rate. The Reserve Bank of New Zealand cut its official interest rate by 25 bp from 2.0% to 1.75% The decision of the central bank was not a surprise for investors, as the probability of a rate cut was more than 80%. Lower interest rate was necessary mainly to maintain the level of inflation. According to forecasts of the RBNZ, inflation will reach the target level of 2% in the fourth quarter of 2018. Earlier, the central bank expected to achieve the goal in the third quarter of 2018. In its accompanying statement, the RBNZ leaders expressed fears of a global political uncertainty. Trump, Brexit, China - among the global uncertainties. Graeme Wheeler is also concerned about how the business will respond to global risks, in particular, he noted the risks associated with the prospects of the Chinese economy. Wheeler also said he did not need one more drop in rates in the near future.

EUR / USD: during the Asian session, the pair rose to $ 1.1300

GBP / USD: during the Asian session, the pair rose to $ 1.2545

USD / JPY: on Asian session the pair fell to Y101.20