Australian Dollar
Strong labour market data pushed the Australian Dollar into a bullish uptrend yesterday. The employment change figure for March showed three times the estimated number of people entered the workforce, clocking in at over 60,000. Part-time employment continued to decline, with full-time employment increasing by almost 75,000. An unexpected rise in the participation rate prevented the unemployment rate from falling from 5.9%. Positive Chinese trade data also helped after softening fears of an economic slowdown in the Asian powerhouse.
Sterling
The AUD/GBP exchange rate charged higher yesterday. The Pound was more mixed overall, making gains against some of its peers due to investor demand for safety. With President Donald Trump calling the US Dollar overvalued and election fears gripping the Euro, the Pound seemed like a good buy for investors looking for some measure of protection from market volatility. The only data released was the RICS house price balance, which edged down to 22%. Estate agents reported a record low number of average unsold properties, while surveyors lowered their forecasts for future sales.
Euro
The Euro plummeted yesterday, with new polls showing that leftist French presidential candidate Jean-Luc Melenchon was continuing to gain support amongst the electorate. The worst-case scenario for investors would be a second round in which Melenchon faces off against Le Pen, as both strongly question the Eurozone and European Union. Although polls suggest the leftist still does not have sufficient support to make it through the first round, investors are remaining cautious; especially considering Brexit and the election of Donald Trump largely caught them by surprise.
US Dollar
The US Dollar was recovering from an overnight sell-off yesterday, with the recent Donald Trump interview broadcast by Fox Business Network giving traders many reasons to question USD long positions. Trump claimed that the US Dollar was overvalued, which was harming the ability of the US to be competitive. He also said he was in favour of a low interest rate policy, further dampening the odds the Federal Reserve will raise interest rates. However, investors quickly returned to the US Dollar, with markets viewing the President’s softening rhetoric on China as a sign he does not intend to start a trade war with the Asian superpower.
There is only US data on the calendar today, due to the beginning of the Easter weekend. While consumer prices are not the Federal Reserve’s preferred measure of inflation, they will nonetheless be an important release.
Canadian Dollar
The Canadian Dollar was on mixed form yesterday, responding to strength or weakness in its peers. Crude oil was edging slightly higher, but gains were nothing that would necessitate a significant repricing of the ‘Loonie’. The day’s data was largely supportive but not hugely impactful; house prices grew at a faster-than-expected rate in February, while manufacturing shipments declined -0.2% instead of the predicted -0.7%.
New Zealand Dollar
New Zealand data was mixed yesterday, but strong Chinese trade figures supported the New Zealand Dollar into a bullish climb against its peers, with the exception of the ‘Aussie’. The Business NZ performance of manufacturing index rose to 57.8, but food prices declined -0.3%, suggesting inflationary pressures remain weak. Chinese data showed that imports increased 20.3% in March; a slowdown from 38.1% to 15.5% had been predicted.
Data Released
April 14th 22.30 USD Consumer Price Index (YoY) (MAR) 2.6%
April 14th 22.30 USD Consumer Price Index Ex Food & Energy (YoY) (MAR) 2.3%