Australian Dollar (AUD) Firms as Trade Surplus Prints above Expectations
The Australian Dollar (AUD) climbed against the majority of its peers yesterday as Australia reported a record trade surplus of AU$12.117bn.
Also assisting the ‘Aussie’, a risk-on market mood drew support away from the safe-haven US Dollar (USD) and towards its peers.
Looking ahead, today’s Markit services PMI and retail sales data could supply headwinds, with both predicted to contract.
Pound (GBP) Resists Considerable Downside despite Lack of Data
The Pound (GBP) initially faced pressure yesterday as a lack of UK data left Sterling vulnerable to losses. However, GBP managed to stabilise as a risk-on mood favoured the currency.
Also tempering Sterling sentiment were ongoing concerns over the UK’s economy, with supply concerns and elevated coronavirus cases casting doubts over the resilience of its recovery.
This afternoon’s finalised Markit services PMI look to confirm service sector activity in the UK slowed to a six-month low in August, which could impose further headwinds – although if the data exceeds expectations, GBP may receive a boost.
Euro (EUR) Muted on Data Absence
The Euro (EUR) slumped against the majority of its peers yesterday as an absence of data exposed the single currency to losses.
The Euro normally benefits on such occasions from any downside in the US Dollar, but in this instance the strong negative correlation between the currencies failed to provide a lift.
Looking ahead, If EU retail sales slow as expected, the Euro could face an uphill battle today.
US Dollar (USD) Slips as Treasury Yields Fall
The US Dollar (USD) struggled to attract support during Thursday’s trading session as falling US Treasury yields limited the appeal of the currency.
This offset the publication of some better-than-expected jobless claims and factory order figures, which may have otherwise helped to buoy the ‘Greenback’.
Shaping the direction of the US Dollar at the end of this week’s session will be the latest non-farm payroll release. Will an underwhelming payroll reading in August send USD exchange rates even lower?
Canadian Dollar (CAD) Firms as Oil Prices Rise
The Canadian Dollar (CAD) trended higher on Thursday, with the appeal of the commodity-linked currency being bolstered by a solid uptick in oil prices, which saw WTI crude rebound above $70 a barrel.
New Zealand Dollar (NZD) Rockets Up on Risk-On Mood
The New Zealand Dollar (NZD) strengthen considerably against the majority of its peers yesterday, as a risk-on mood buoyed trading sentiment.
Data Releases
Sep 3rd 09:00 AUD Markit Services PMI Final 43.3
Sep 3rd 11:30 AUD Retail Sales (Jul) -2.7%
Sep 3rd 17.55 EUR German Services PMI (Aug) 61.5
Sep 3rd 18:00 EUR Services PMI (Aug) 59.7
Sep 3rd 18:30 GBP Services PMI (Aug) 55.5
Sep 3rd 19:00 EUR Retail Sales (Jul) 0.1%
Sep 3rd 22:30 USD Non-Farm Payrolls (Aug) 750,000
Sep 4th 00:00 USD ISM Non-Manufacturing PMI (Aug) 61.5