Australian Dollar
The only Australian data released on Friday was negative, with the latest performance of services index dropping into contraction territory with a score of 49 from 54.5. However, several of the other majors were facing more significant headwinds and so the Australian Dollar was able to make some strong advances, although it slumped against the Euro and was soft versus the US Dollar.
The next Reserve Bank of Australia (RBA) monetary policy meeting is due to take place tomorrow.
Sterling
The Australian Dollar was able to make strong gains against the Pound on Friday, despite facing its own headwinds. The UK services and composite PMIs from Markit realised investor’s worst fears after slowing much further-than-expected in February. The services index, expected to edge down from 54.5 to 54, dropped to a five-month low of 53.3, while the composite fell from 55.4 to 53.8 instead of climbing to 55.6. Economists believe that the latest data points towards UK GDP slowing to 0.4% in the first quarter of 2017 after accelerating to 0.7% in the final three months of 2016.
Saturday morning will see the release of the NIESR GDP estimate for February.
Euro
Suggestions the latest chapter in the Greek debt crisis could soon be closed saw the Euro trending higher on Friday, despite a mixed docket of economic data. Greek Prime Minister Alexis Tsipras expressed his confidence that his government could reach a deal with Eurogroup creditors to avoid the nation defaulting on its debt when repayments are due in July. Delays to negotiations had made it unlikely a review can be concluded in time to make the next tranche of bailout funds available to the country before it needs to make payments in the summer. Therefore, news Greece may be allowed to draw down the debt has improved the outlook for the stricken Eurozone member. There were even suggestions that the Greek government may look to re-enter the bond market this year.
The European Central Bank (ECB) meets to set monetary policy on Thursday.
US Dollar
Saturday morning’s packed schedule of speeches from Federal Reserve officials kept the US Dollar soft during the day’s trading. Investors were waiting to hear what Charles Evans, Jeffrey Lacker, Jerome Powell, Stanley Fischer and Janet Yellen would have to say on the prospect of a rate hike during this month’s policy meeting. The potential for dovish comments to drastically weaken the odds of tightening – which were at 75.3% ahead of the weekend – kept investors wary of committing to the ‘Greenback’.
Vital US non-farm payrolls data is set for release early on Saturday morning.
Canadian Dollar
The Canadian Dollar was on mixed form on Friday, weakening thanks to a bout of profit-taking following the stellar gross domestic product figures released just after midnight. The Canadian economy expanded 2% year-on-year in December against predictions of 1.7%, while quarterly GDP clocked in at 2.6% against expectations of 2%.
Canadian unemployment figures will be released early on Saturday morning.
New Zealand Dollar
The New Zealand Dollar slumped on Friday. The day’s available data was positive, showing rising job advertisements, increasing value of new building work and rising commodity prices, but these were considered to be of little influence. News that the government was planning on cracking down on corporate tax avoidance unsettled investors, who worried that large multi-nationals doing business in the country could be put off by such a move. Additionally, representatives for New Zealand’s farming industry warned that Donald Trump’s US trade policies would have a ‘devastating’ impact upon the New Zealand economy.
Tuesday will see the results of the latest Global Dairy Trade auction.
Data Released
March 7th NZD Global Dairy Trade Auction
March 7th 14.30 AUD Reserve Bank of Australia Rate Decision (MAR 07) 1.5%
March 9th 23.45 EUR European Central Bank Rate Decision (MAR 09) 0.00%
March 11th 00.30 USD Change in Non-farm Payrolls (FEB) 186k
March 11th 00.30 CAD Net Change in Employment (FEB) 0k
March 11th 02.00 GBP NIESR Gross Domestic Product Estimate (FEB)