Australian Dollar (AUD) Fluctuates on USD Volatility
The Australian Dollar (AUD) initially rallied on Friday, with the risk-sensitive currency able to advance through the Asian trading session amidst a pullback in the US Dollar (USD).
However, the ‘Aussie’ plummeted from its best levels as the US Dollar staged a comeback and weakened market risk appetite.
Turning to the week ahead, the primary focus for AUD investors is likely to be Australia’s latest jobs report, with the Australian Dollar poised to rally, if domestic unemployment continues to drop.
Pound (GBP) Sidelined by Reopening Fears
The Pound (GBP) struggled to attract support at the end of last week’s session, amidst growing speculation that the UK government will delay the next stage of lockdown easing.
This overshadowed the publication of the UK’s latest GDP figures, which may have otherwise helped to buoy Sterling, after reporting the UK’s economic recovery continued to gather pace in April.
Looking ahead, Boris Johnson’s announcement on whether or not the 21 June reopening will be delayed will no doubt be the focus for GBP investors today. Expect the Pound to drop if the government postpones the UK’s reopening date as expected.
Euro (EUR) Undermined by USD Strength
The Euro (EUR) retreated on Friday, as the single currency’s negative correlation with the US Dollar, saw it weaken as the latter rallied.
The Euro struggled to catch a break despite Germany’s Bundesbank semi-annual forecasts striking an upbeat tone, predicting that German economic growth will rise to 3.7% in 2021.
Coming up, will an acceleration in Eurozone industrial production in April, help the Euro get off to a strong start this week?
US Dollar (USD) Rallies amidst Rising Treasury Yields
The US Dollar (USD) ended last week’s session on a positive note, with a strong uptrend in US Treasury yields, which rose by over 1% during the US trading session, boosting the appeal of the ‘Greenback’.
Reinforcing the upside in USD exchange rates was a higher-than-expected print in the University of Michigan’s latest consumer sentiment index.
Turning to the week ahead, the spotlight for USD investors will undoubtedly be on the Federal Reserve’s latest policy meeting. Expect to see the US Dollar face some headwinds if the bank maintains its stance that the recent rise in inflation is ‘transitory’.
Canadian Dollar (CAD) Firms as Oil Prices Tick Higher
The Canadian Dollar (CAD) trended higher on Friday, as the appeal of the commodity-linked currency was bolstered amidst a modest uptick in oil prices, with WTI crude further consolidating its rise above $70 a barrel.
New Zealand Dollar (NZD) Slumps amid Waning Risk Appetite
The New Zealand Dollar (NZD) closed last week’s session on a sour note, with demand for the risk-sensitive ‘Kiwi’ falling sharply, amidst renewed USD strength.
Jun 14th 19:00 EUR Industrial Production (Apr) 0.4%