Australian Dollar
There was no Australian data released yesterday, but the Australian Dollar was largely on the rise. The ‘Aussie’s decline following last week’s dovish Reserve Bank of Australia (RBA) meeting minutes had bottomed out, with investors enticed by the low valuation of AUD to speculate on the high-risk currency. Additionally, Japan’s Finance Minister Taro Aso commented that talks would soon begin on resurrecting the Trans-Pacific Partnership; a vast trade deal, of which Australia is a member, which has been all but torn up after Donald Trump withdrew the US at the start of his Presidency.
Sterling
New data from the Confederation of British Industry (CBI) yesterday concerned investors in the Pound, allowing the AUD/GBP exchange rate to notch up strong gains. The selling prices index held at 29, instead of falling to 27 as predicted, but the trends for total orders measure halved to 4 instead of ticking down to 6. Business optimism performed the worst of all, crashing from 15 to 1; a decline to 12 had been on the cards. The data revealed that hiring and investment intentions were weak, with machinery investment plans at a near-six-year low.
UK government borrowing figures are set for release today.
Euro
The Euro rocketed higher across the board yesterday in reaction to the results from the weekend’s French Presidential Election. Emmanuel Macron, the market favourite, has advanced to face-off against Marine Le Pen in the final round on May 7th. This was as polls had predicted and suggests that the surveys indicating a 62-38% win in Macron’s favour may also be accurate. A near-six-year high for the German Ifo business climate index and a 69-month best for the current assessment measure further helped propel the Euro higher.
There is little on the Eurozone data calendar today; the European Central Bank’s (ECB) Bank Lending Survey and fourth-quarter Eurozone government debt figures are all that is on offer.
US Dollar
The outcome of the French Presidential Elections caused a surge of demand for the Euro, prompting investors to sell out of the US Dollar. Other safe-haven assets, such as gold and the Japanese Yen, also suffered; the Euro is a generally stable currency and so provides a safer return for investors than some of the commodity currencies, but was yesterday behaving like a more risky asset, with its average gains in the region of 1-1.5%. Meanwhile, the US government was facing a deadlock with Congress over future government funding; some of which would go on paying for Trump’s wall along the Mexican border. Democrats are flat-out refusing to approve any measure that funds the wall, leaving the government facing a shutdown next weekend due to a financial void – which would happen to coincide with Trump’s 100th day in office.
Today’s data is unlikely to be very impactful for the US Dollar, but the consumer confidence figures for April released at midnight tomorrow could have a more notable effect on the ‘Greenback’.
Canadian Dollar
Like that of the Australian Dollar, the Canadian Dollar’s decline seemed to have bottomed out yesterday, with the ‘Loonie’ mostly on the rise. This was despite weak domestic data, which showed that wholesale sales had declined -2% month-on-month in February – double the pace expected – while January’s sales growth was revised lower to 3%. Additionally, oil was sliding back towards the lows of last week, but the Canadian Dollar still climbed.
New Zealand Dollar
The New Zealand Dollar weakened yesterday, as investors were presented with better options. Those looking for high-yields could buy into the resurgent Australian Dollar, while those wanting a safer bet could buy into the rapidly appreciating Euro. A lack of domestic data left the New Zealand Dollar without direction.
Data Released
April 25th 18.00 EUR ECB Bank Lending Survey
April 25th 18.30 GBP Public Sector Net Borrowing (Pounds) (MAR)
April 26th 00.00 USD Consumer Confidence (APR)