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New Zealand Dollar will experience short-term strength in the following days following the comments made by the IMF managing director. Kristalina Georgieva, a Bulgarian economist, will replace Christine Lagarde as the new International Monetary Fund director. Lagarde, on the other hand, became the new president of the European Central Bank. Following her appointment, Georgieva made bold comments on emerging economies. This includes New Zealand whom she said will have an economic growth higher than other countries in the coming year. She said the growth among advanced economies is expected to be in 1.7 percent in 2019 and 2020. But New Zealand’s growth is forecast to run at 2.54 percent this year, rising 2.7 percent next year. The comments are expected to give New Zealand leverage during trade negotiations. New Zealand is seeking to sign a post-Brexit trade agreement with the United Kingdom and China.
Israel Shekel is under pressure following the withdrawal of the United States in Syria. The U.S., Israel, and Saudi Arabia backs opposition in Syria. On the other hand, Russia, Turkey, and Iran back the Assad government. For years, the U.S. and Turkey tried to reach an agreement that will protect civilians in the country. However, following the fallout of the relationship between the NATO allies, the U.S. want to reshape geopolitics in the region. Recently, Israel Prime Minister Benjamin Netanyahu sent an official letter to Russian President Vladimir Putin to release jailed Israeli citizen. However, the release is not expected without Israel concession. This will put pressure on the U.S.-Israel relationship. The withdrawal of the U.S. from Syria will also leave Israel fighting for the Kurdish fighters. The move comes at a time wherein the political future of PM Netanyahu was in a dark place. This was amid his failure to make a coalition government.
The U.S. Dollar will continue to be dragged by the recent comments made by Czech Prime Minister Andrej Babis. The PM suggested that Czechia must build new power plants to replace coal and nuclear capacity. This is to be made even if it breaches the European law banning the increase in the number with power plants. Political analysts warned that this might led to the same fate with Iran. Iran was one of the countries with stockpiles of low-enriched uranium, a main ingredient of nuclear weapons. This lead to the creation of the Joint Comprehensive Plan of Action (JCPOA) led by then President Barack Obama. However, under the Trump administration, the U.S. pulled out from the deal. This led to Iran continuing its nuclear activity. Czech Republic is the 14th country with the largest number of nuclear plants. 7 out of 17 countries with nuclear power plants are from Europe.
The Canadian Dollar will weaken against the New Zealand Dollar following a looming Canadian federal election on October 31. The election is seen to be challenging for the incumbent prime minister, Justin Trudeau, as he seeks reelection bid for the second term. In the recent months, Trudeau’s name was dragged on several issues, including the SNC-Lavalin case. The Prime Minister and his senior aides were accused of pressuring the country’s then Justice Minister. This was to acquit SNC-Lavalin from its pending cases. Aside from that, Trudeau was also accused of poor handling of China’s banning of Canadian exports to the country. Its relationship with the Kingdom of Saudi Arabia also enters a new low. Among the leading contenders for the Canadian premiership were Andrew Scheer of the Conservative party and Jagmeet Singh of the New Democratic Party.