Australian Dollar (AUD) Fluctuates amid Shifting Risk Appetite
The Australian Dollar (AUD) fell back during Wednesday’s Asian trading session, with renewed USD strength dampening the appeal of the ‘Aussie’ in spite of a stronger-than-expected consumer confidence reading in March. However, AUD exchange rates rebounded overnight as a subsequent pullback in the US Dollar bolstered market risk appetite.
Should the market mood remain broadly positive we could see the Australian Dollar attempt to build on these gains through today’s session.
Pound (GBP) Steady on Vaccine Progress
Trade in the Pound (GBP) was stable yesterday, as the currency continued to garner support from the success of the UK’s vaccination programme. However, the upside in Sterling remained limited by concerns that the recent reopening of schools could delay the easing of further lockdown restrictions due to the increased risk of cases rising again.
Looking ahead, the continued absence of any notable GBP data will likely see UK coronavirus statistics remain in focus, potentially leaving the Pound on a flat trajectory at the start of the second half of the week.
Euro (EUR) Subdued ahead of ECB Decision
The Euro (EUR) was mostly rangebound through yesterday’s trading session, with the currency only finding any meaningful gains against the US Dollar (USD). The muted trade in the Euro came amid the absence of any notable economic data, as well as the reluctance of EUR investors to make any aggressive bets ahead of today’s European Central Bank’s (ECB) rate decision.
The decision will no doubt be in the spotlight today. No policy changes are expected from the ECB this month, but EUR investors will be paying close attention to the bank’s forward guidance for fresh impetus.
US Dollar (USD) Slips as Core CPI Misses
The US Dollar (USD) ticked lower on Wednesday after the latest US consumer price index weakened US Treasury yields. While headline inflation printed in line with expectations, rising from 1.4% to 1.7% in February, an unexpected drop in core inflation helped to cool concerns that inflationary pressures could be building too quickly.
Turning to today’s session, the focus for USD investors will be on the latest US initial jobless claims. Will a fall in new claims last week help the US Dollar to mount a recovery later tonight?
Canadian Dollar (CAD) Muted Following BoC Rate Decision
The Canadian Dollar (CAD) was subdued on Wednesday as the Bank of Canada (BoC) concluded its latest policy meeting. While leaving interest rates on hold as expected this month, the BoC warned that the pandemic remains a major risk to the economy.
New Zealand Dollar (NZD) Retreats as Risk Appetite Softens
The New Zealand Dollar (NZD) also trended lower on Wednesday, amidst a weakening of risk appetite before rebounding in overnight trade as the US Dollar retreated.
Data Releases
Mar 11th 22:45 EUR ECB Rate Decision 0%
Mar 11th 23:30 USD Initial Jobless Claims (6/Mar) 725,000
Mar 12th 01:00 USD JOLTs Job Opening (Jan) 6.6m