Australian Dollar
The Australian Dollar was on poor form yesterday, weakening after the release of soft inflation data from China. Price growth accelerated ten basis points to 0.9%, instead of climbing to 1% as expected in March. Additionally, building fears over a steel glut saw producer price growth slow for the first time in seven months. This bodes ill for Australian iron ore and coal exporters, which play a significant role in driving the domestic economy.
Headline labour market figures are set for release today and could provide the softened ‘Aussie’ with some support if they print positively.
Sterling
AUD/GBP slipped below opening levels yesterday, with the Pound recording soft gains against most of its peers. The latest UK wage data wasn’t exactly encouraging; even though pay growth overall met forecasts of 2.3% for the three months to February, earnings excluding bonuses actually rose at a slower pace than inflation. Additionally, over 25,000 more people were claiming jobless benefits, pushing the claimant count rate up from 2.1% to 2.2%. A speech from Bank of England (BoE) Governor Mark Carney contained no references to monetary policy.
The only UK data release on the calendar today is the RICS house price balance figure for March.
Euro
The Euro was on mixed form yesterday. Investors were awaiting the latest developments in the US, leaving little appetite for the common currency. The only notable data released was the German wholesale price indices for March. A slight weakening in wholesale price growth on the year, coupled with stagnation on the month, could indicate that inflationary pressures are set to weaken in the Eurozone’s powerhouse economy.
The only Eurozone data released today will be the finalised German consumer price index figures for March.
US Dollar
The US Dollar was largely soft yesterday, with investors awaiting the broadcast of an interview with President Donald Trump conducted by Fox Business News. Fox claimed the President had answered questions on everything from diplomatic relations with Russia to his plans for fiscal stimulus. The latter was of particular interest; with the Fed seeming cautious on further monetary tightening, Trump has become the sole major risk to USD stability. However, early comments released from the interview suggested fiscal stimulus was still a way away, with the President claiming he wanted to focus on healthcare reform before tackling tax and spending.
The latest University of Michigan consumer confidence index is set for release at midnight on Friday.
Canadian Dollar
Oil was on the rise yesterday, supported by rumours that Saudi Arabia was pushing for other OPEC members to extend the agreed production cut past June. Additionally, a report showed that members of the cartel had curbed their output to a greater extent than was demanded by the agreement made in November. This helped support the Canadian Dollar higher against its peers. The latest monetary policy decision from the Bank of Canada (BOC) saw rates frozen again, but policymakers did acknowledge the stronger state of the economy, even if noting that much slack remained.
Canadian housing price and manufacturing shipment data is set for release today.
New Zealand Dollar
The New Zealand Dollar slumped yesterday. The weaker-than-expected Chinese inflation data deterred investors from buying into the risky ‘Kiwi’. Markets were also awaiting the Fox interview with Donald Trump, which had the potential to drastically change the US Dollar outlook and therefore the outlook for the New Zealand Dollar as well.
The Business NZ performance of manufacturing index for March is the most important release on the New Zealand data calendar today.
Data Released
April 13th 08.30 NZD Business NZ Performance of Manufacturing Index (MAR)
April 13th 09.01 GBP RICS House Price Balance (MAR) 22%
April 13th 11.30 AUD Employment Change (MAR) 20k
April 13th 16.00 EUR German Consumer Price Index (MoM) (MAR F) 1.6%
April 13th 22.30 CAD New Housing Price Index (YoY) (FEB)
April 14th 00.00 USD U. of Michigan Confidence (APR P) 96.5