Australian Dollar
A combination of poor data from at home and overseas weakened the Australian Dollar against the majority of its peers yesterday. Australian building approvals fell by -13.4% on the month and -19.9% on the year in March, vastly outpacing forecasts of -4% and -10% respectively. Meanwhile, Chinese imports grew 11.9% instead of the predicted 18% year-on-year in April, which suggests Australian exporters may not have had a good month.
Weekly Australian confidence data, as well as retail sales figures for March and the first quarter of 2017, is set for release today.
Sterling
AUD/GBP exchange rates weakened yesterday, although the Pound was not performing so well elsewhere. Sterling largely edged lower in response to the French election results, as victor Emmanuel Macron is a strongly pro-EU politician who previously called Brexit a ‘crime’. He has vowed to be tough on the UK in the upcoming negotiations.
Today’s BRC like-for-like retail sales figures could influence the Pound, given that consumer spending is vital for continued economic strength in the UK.
Euro
The Euro was largely falling yesterday, as the result of the French election was not a surprise. Polls had indicated the result would be strongly in Macron’s favour since even before the first round of voting confirmed he would definitely face off against Marine Le Pen. The Euro had already risen on the likelihood of his victory, so markets were in profit-taking mode yesterday. Above-forecast German factory orders growth in March and Sentix investor confidence index figures for May failed to keep the common currency above opening levels.
German industrial production and trade balance figures for March are the most high-profile figures on the Eurozone data calendar today.
US Dollar
The US Dollar was mostly making strong advances yesterday, even after St Lois Federal Reserve President James Bullard claimed that interest rates were roughly where they needed to be, lowering the odds of another hike in June. Bullard, who at the beginning of 2016 had been much more optimistic on the economy, stated that there was no rush to continue raising interest rates.
There is little by way of developments on the US data calendar today, with the NFIB small business optimism index being the only ecostat scheduled for release today.
Canadian Dollar
The Canadian Dollar was on the decline yesterday, tracking oil prices lower after crude fell by around 0.7%. While there were suggestions Russia and OPEC were hoping to extend their production cuts into 2018, they failed to boost sentiment. News that US oil drillers continued to increase output weighed on CAD, with the number of new oil rigs in operation increasing for the 16th week in a row, marking the 12th consecutive month in which drilling activity has recovered.
Canadian building permits data will be published today and could help boost the Canadian Dollar if it shows a recovery from March’s -2.5% decline.
New Zealand Dollar
With the threat of a far-right victory in the French Presidential Elections over, investors were less concerned about geopolitical forces yesterday. Risk-appetite reignited, causing the New Zealand Dollar to trend bullishly. Also supporting the ‘Kiwi’ were comments from Westpac Chief Executive David McLean, after he said that the housing market appeared to be cooling faster-than-expected; a positive sign that could help relieve pressure on the banking sector.
Data Released
May 9th 09.01 GBP BRC Sales Like-For-Like (YoY) (APR)
May 9th 11.30 AUD Retail Sales Ex Inflation (MoM) (MAR) 0.3%
May 9th 16.00 EUR German Trade Balance (Euros) (MAR) €19.9b
May 9th 20.00 USD NFIB Small Business Optimism (APR) 104
May 9th 22.30 CAD Building Permits (MoM) (MAR) 0.5%