Australian Dollar
The Australian Dollar put on a mixed performance on Tuesday as investors responded to a range of domestic and external stimuli.
In terms of local news, an over 18% surge in the price of crude oil (a key Australian commodity) sent AUD trading higher and helped the South Pacific currency achieve an eight-month high of 74.70 against the US Dollar.
Local data also showed an improvement in Business Conditions in February, with the NAB gauge rising from 5 to 8. Business Confidence held steady at 3.
China’s trade figures were less encouraging, with both imports and exports falling by more-than-anticipated on the year last month. While the data reignited global slowdown fears, the prospect of the People’s Bank of China (PBoC) rolling out additional stimulus measures to support the local economy supported a risk-off attitude.
However, conflicting statements from Federal Reserve officials regarding the central bank’s approach to future policy saw the ‘Aussie’ trim gains slightly as trading continued. Demand for AUD was also knocked as Reserve Bank of Australia (RBA) Deputy Governor Philip Lowe indicated that he’d prefer the domestic currency to be weaker and that the central bank has room to ease further.
Today’s Australian Dollar movement could be caused by the Westpac Consumer Confidence index for March and home loans/investment lending/value of loans figures. Any movement in iron ore prices will also be instrumental.
Sterling
As the influential UK data drought continued, Pound movement was limited. Those Sterling fluctuations which did occur, including a modest loss against the Australian Dollar, were largely the result of external circumstances and persistent ‘Brexit’ concerns in light of yesterday’s high-profile resignation from the British Chambers of Commerce Director General.
Tuesday’s only UK data, the British Retail Consortium’s Like-for-Like sales figure for February printed at 0.1% – a marked decline from January’s reading of 2.6%.
Bank of England (BoE) Governor Mark Carney’s comments regarding banks potentially leaving London on a ‘Brexit’ also kept Sterling sentiment suppressed. With the UK set to publish Industrial/Manufacturing Production data today, AUD/GBP fluctuations may be more notable.
Euro
Although better-than-forecast German Industrial Production and Eurozone Growth data lent the Euro support on Tuesday, gains were a little limited as Greek bailout concerns returned to the fore. The AUD/EUR exchange rate still lost over 0.3% during the European session but the pairing could swiftly recover losses in the second half of the week.
With Eurozone data in short supply today, investors will be looking ahead to tomorrow and the potentially market-shifting European Central Bank (ECB) interest rate announcement.
Aggressive stimulus measures from the ECB would drive the Euro lower against peers like the ‘Aussie’ while a failure to act as decisively as promised is liable to send EUR higher.
Other Eurozone news to be aware of includes Germany’s trade figures for January.
US Dollar
Mixed commentary regarding the path of US interest rates from several key Federal Reserve officials saw the US Dollar experiencing patchy trading on Tuesday, with the safe-haven asset up against the Pound, Australian Dollar and Canadian Dollar, but down against the Euro.
The US NFIB Small Business Optimism index for Feb printed at 92.9, down from 93.9. However, while the ‘Greenback’ was able to recoup some of its recent losses against the ‘Aussie’ the AUD/USD pairing remained close to an 8-month high.
The next US data with the potential to inspire US Dollar movement, Wholesale Inventories figures, is scheduled for publication tomorrow.
Canadian Dollar
The ‘Aussie’ romped higher against the ‘Loonie’ on Tuesday as the spiking price of iron ore kept AUD demand high.
Dipping oil prices were also responsible for the Canadian Dollar’s losses. Commodity price shifts are likely to cause further AUD/CAD movement as the week continues.
New Zealand Dollar
With Manufacturing Activity in New Zealand slumping by -1.9% in the fourth quarter of 2015, the New Zealand Dollar slid against its Australian counterpart on Tuesday.
Ahead of the Reserve Bank of New Zealand’s (RBNZ) interest rate decision, New Zealand’s Card Spending data for February could trigger ‘Kiwi’ fluctuations.
Data Released
March 09th 08:45 NZD Card Spending Retail (MoM) (FEB)
March 9th 10:30 AUD Westpac Consumer Confidence (MAR)
March 9th 11:01 GBP BRC Shop Price Index (YoY) (FEB)
March 9th 11:30 AUD Home Loans (JAN)
March 9th 11:30 AUD Value of Loans (MoM) (JAN)
March 9th 20:30 UK Industrial/Manufacturing Production (JAN)