Australian Dollar (AUD) Struggles on Chinese Data Miss
The Australian Dollar (AUD) struggled at the start of this week as lacklustre Chinese retail sales figures limited the ‘Aussie.’
China, Australia’s largest trading partner, saw data reveal that year-on-year sales growth rose 17.7% in April, well below market forecasts for an increase of 24.9%.
Furthermore, also dampening the risk-sensitive ‘Aussie’ has been to global risk-off mood, as violence continues to escalate between Israel and Palestine and mixed coronavirus news pushes investors towards safe-haven currencies.
Looking ahead, the minutes from the Reserve Bank of Australia’s (RBA) latest policy meeting could offer some support to AUD exchange rates if the tone maintains cautious optimism for the outlook for Australia’s economy.
Pound (GBP) Steady as UK Eases Restrictions
The Pound (GBP) was steady throughout much of Monday’s session as many parts of the UK eased coronavirus restrictions, with indoor hospitality returning, and museums and theatres able to reopen.
However, concerns over the Indian variant of the virus causing a further wave of coronavirus and derailing lockdown easing plans for the 21st June has caused some investors to shy away from Sterling.
The UK’s latest employment data will be a key focus for GBP investors this afternoon. With the UK unemployment rate forecast to have held steady at 4.9% in March, the Pound could extend Monday’s gains.
Euro (EUR) Supported USD Weakness
The Euro (EUR) received support at the start of the week as a mixed US Dollar helped to bolster the currency for much of the day due to the negative correlation in the pairing.
A lack of notable data from the Eurozone had left the single currency open to losses, however EUR held its strength for much of the day.
Tomorrow will see the second estimate for GDP growth in the Eurozone for Q1, which is expected to confirm that the bloc’s economy contracted 0.6% and could cause the Euro to weaken.
US Dollar (USD) Limits Losses amid Risk-Off Trade
The US Dollar (USD) started the week on mixed footing as stagnant retail sales from the US at the end of last week caused the ‘Greenback’ to stumble.
However, a risk-off mood has limited any major losses for USD as the currency looks to regain traction against its major rivals.
Looking ahead, the US Dollar could receive further support if the global market mood continues to weaken.
Canadian Dollar (CAD) Boosted by Oil Prices Uptick
The Canadian Dollar (CAD) strengthened overnight as the oil-sensitive ‘Loonie’ received support from WTI crude rising over 1%.
New Zealand Dollar (NZD) Slides on Risk-Off Trade
The New Zealand Dollar (NZD) slumped during Monday’s session as disappointing Chinese data and a risk-off mood weighed on NZD exchange rates.
Data Releases
May 18th 11:30 AUD RBA Meeting Minutes
May 18th 16:00 GBP Unemployment Rate (Mar) 4.9%
May 18th 19:00 EUR GDP Growth Rate (Q1) -0.6%