Australian Dollar
Although the Australian Dollar was making some gains yesterday, the ‘Aussie’ was only able to capitalise upon weakness in other currencies. A strong US Dollar and disappointing domestic data sapped the Australian Dollar of any momentum. The number of skilled jobs vacancies continued to decline, although the pace slowed from -0.8% to -0.4%. Construction work done in the third quarter saw its largest drop in 16 years, shrinking -4.9% against forecasts of a -1.6% fall after Q2’s -3.1% slide.
Sterling
The Australian Dollar to Pound Sterling exchange rate undulated yesterday before trading flatly towards the end of the London session after Chancellor Philip Hammond’s Autumn Statement divided investors. Markets were not sure what to make of the Chancellor’s plans; the Pound had initially weakened on suspicions Hammond would be unable to implement additional spending thanks to the size of the deficit. However, there were some modest giveaways, including intentions to develop transport links, reduce the productivity gap, improve internet technology and boost exports – all of which investors responded positively to.
The UK’s BBA loans for house purchase data could cause some movement for the AUD/GBP exchange rate, although it may get ignored as investors continue analysing what exactly the Autumn Statement means for the US economy.
Euro
Economic activity in the Eurozone may have hit its highest level in 2016 and pointed to an acceleration of GDP in the fourth quarter, but the Euro slumped yesterday. US Dollar strength left the common currency unappealing. Germany’s manufacturing and composite PMIs both weakened further-than-expected, but the overall Eurozone measures all improved. Eurozone manufacturing clocked in at 53.7, services at 54.1 and the composite at 54.1.
There is a slew of Eurozone data due this evening, including the German GfK consumer confidence survey results for December.
US Dollar
Bets of Federal Reserve monetary tightening next month edged down from their record highs of 100% yesterday, although they quickly bounced back up to 98.2% after US data was released early this morning. After falling -0.3% in September, durable goods orders were expected to rise 1.7% but instead leapt up by 4.8%. The US Dollar managed to register bullish gains, although the Australian Dollar was able to largely resist USD advances.
The day’s US data has all already been released this morning and the US Dollar is likely to continue trading in reaction to the Federal Open Market Committee (FOMC) November meeting minutes.
Canadian Dollar
Investors were back to worrying about oil yesterday. While the consensus opinion was that the Organisation of the Petroleum Exporting Countries (OPEC) would agree to a production cut, investors were worried that the terms of the deal wouldn’t go far enough. Iran’s involvement was still shrouded in uncertainty – would the nation participate at a reduced level; would it agree to a commensurate reduction in output to other cartel members; or would it continue to increasing output regardless of the deal? As a result, the Canadian Dollar was largely weak yesterday.
New Zealand Dollar
There was no data pertaining to New Zealand released yesterday, leaving nothing to prevent the New Zealand Dollar slumping against its peers. The US Dollar was bullish on the back of Federal Reserve hike bets, leaving little appetite for the risky ‘Kiwi’.
Data Released
November 24th 06.00 USD US Fed Releases Minutes from November 1-2 FOMC Meeting
November 24th 20.30 GBP BBA Loans for House Purchase (OCT)
November 24th 23.00 EUR German GfK Consumer Confidence Survey (DEC)