Could Dovish RBA Minutes Dent the Australian Dollar?

Australian Dollar Slips as Chinese Imports Continue to Plummet

The Australian Dollar closed last week’s session on the back foot, trending lower on Friday following the publication of China’s latest trade figures. These revealed that Chinese imports continued to contract at a dramatic pace last month, stoking concerns that demand for Australian exports will slide.

Coming up at the start of this week we have the publication of the minutes from the Reserve Bank of Australia’s (RBA) recent policy meeting. They could drag on the ‘Aussie’ if the bank remains open to the possibility of further monetary easing.

Pound Shrugs Off Vlieghe Brexit Warning

The Pound (GBP) traded in a narrow range at the end of last week as GBP investors appeared to largely ignore a Brexit warning from the Bank of England’s Gertjan Vlieghe. This comes in spite of Vlieghe asserting that the BoE may need to cut rates ‘close to 0%’ in the event of a no-deal Brexit and warning they would likely to remain this low for some time.

Looking ahead, the focus for GBP investors this week will be on the UK’s latest employment figures, with another drop in wage growth likely to weigh on Sterling.

Euro Slips despite Upbeat Eurozone Data

The Euro (EUR) faced broad losses at the end of the week as the European Central Bank’s François Villeroy de Galhau added to calls for the ECB to inject stimulus into the Eurozone. The slide in the Euro also came in spite of the Eurozone’s latest industrial production figures beating expectations, with production growing by 0.9% in May against expectations of a more modest 0.1% expansion.

Expect to see the Euro remain on the back foot through the first half of this week’s session if Eurozone economic sentiment remains gloomy in July as suspected.

US Dollar Strengthens as PPI Figures Beat Expectations

The US Dollar (USD) trended higher the end of last week’s session, with the ‘Greenback’ recouping some ground after US PPI figures came in above expectations. Also lending some support to the US Dollar on Friday were the rising trade tensions between the US and China, which helped buoy demand for the safe-haven currency.

The focus for USD investors this week is likely to be the latest US retail sales figures on Wednesday, with the US Dollar potentially weakening if sales growth weakened in June as forecast.

Canadian Dollar Steady as Oil Price Hold at $67 a Barrel

The Canadian Dollar (CAD) was mostly rangebound at the end of last week’s session with the oil-sensitive ‘Loonie’ holding its ground as Brent crude remained close to a six-week high.

New Zealand Dollar Weakened by Falling Risk Appetite

The New Zealand Dollar (NZD) was left muted on Friday, with the ‘Kiwi’ retreating from its initial highs as US-China trade tensions clipped demand for the risk sensitive currency.

Looking to the week ahead we have the publication of New Zealand’s latest CPI figures, which could give the ‘Kiwi’ a boost if inflation accelerated in the second quarter as expected.

Data Releases

July 15th 20:30 USD Empire State Manufacturing Index 0.5

Louisa Heath

louisa.heath@torfx.com


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