Australian Dollar (AUD) Firms on Upbeat PM Comments
The Australian Dollar (AUD) rose against the majority of its peers yesterday as Prime Minister Scott Morrison gave an optimistic press conference.
The PM remarked that Australia had cleared a very important hurdle in the fight against Covid-19, as New South Wales’ Premier Dominic Perrottet doubled the number of people who can attend home visits.
This morning’s financial stability review from the Reserve Bank of Australia (RBA) may influence ‘Aussie’ trading throughout the session, alongside risk sentiment and economic developments in China.
Pound (GBP) Faces Headwinds on UK Energy Crisis
The Pound (GBP) traded in a mixed range on Thursday as energy prices remained high, as the UK government sought to reassure the public that its energy supplies will meet demand this winter.
Sterling also remained rangebound on the back of comments from Bank of England (BoE) policymaker Huw Pill, as he acknowledged the UK’s recent spike in inflation will likely last longer than previously forecast.
A lack of significant data through today’s session means GBP trading will likely take direction from overall market mood. Britain’s Energy Minister has warned that more firms could fail – which, if it comes to pass, will likely subdue Pound sentiment.
Euro (EUR) Suffers as German Data Disappoints
The Euro (EUR) came under pressure yesterday as Germany’s industrial production release revealed a greater-than-expected drop in activity. The contraction is broadly attributed to ongoing supply chain disruptions, as well as shortages of key parts.
Minutes from the European Central Bank (ECB) were also released in the afternoon, giving little indication as to when tapering may begin. Some members advocated for significant tapering, while others favoured a more prudent approach.
Additional German data this afternoon may influence the Euro, as Germany’s balance of trade looks to print lower than last month. If predictions are accurate, EUR may face further downside.
US Dollar (USD) Fluctuates amid Mixed Market Sentiment
The US Dollar (USD) fluctuated against its peers on Thursday as a risk-on mood posed headwinds while Federal Reserve optimism bolstered ‘Greenback’ sentiment. Investors are hopeful that September’s nonfarm payroll data will be the catalyst for a November tapering announcement.
Also supporting the US Dollar, a temporary solution may have been found to resolve America’s debt ceiling issue. Republicans and Democrats in Congress agreed to consider a stop-gap measure that would extend the borrowing limit until December.
Into today, risk sentiment is likely to affect USD trading, as investors await the publication of the latest US non-farm payroll release later tonight.
Canadian Dollar (CAD) Under Pressure over Oil Depreciation
WTI crude fell from its nine-year high through yesterday’s session, pressuring Canadian Dollar (CAD) sentiment. Meanwhile, some upside momentum was maintained by better-than-expected PMI data.
Canada’s Ivey PMI increased to 70.4 in September, from 66 the month previous- the highest reading since June.
Employment data this evening may lend further support to the ‘Loonie’, with the unemployment rate set to fall by 0.2%.
New Zealand Dollar (NZD) Trends Down as Covid Worries Persist
The New Zealand Dollar (NZD) continued to slide yesterday as the country’s abandonment of its zero-Covid strategy encouraged bearish trading.
Leading epidemiologist Michael Baker advised New Zealanders to prepare to encounter the virus before Christmas, recommending vaccination as soon as possible. So far, only 51% of the population over the age of 12 have been completely vaccinated.
Data Releases
Oct 8th 11:30 AUD RBA Financial Stability Review N/A
Oct 8th 16:00 EUR German Balance of Trade (Aug) €14.4bn
Oct 8th 22:30 CAD Unemployment Rate (Sep) 6.9%
Oct 8th 22:30 CAD Average Hourly Wages (Sep) 1.6%
Oct 8th 22:30 USD Unemployment Rate (Sep) 5.1%
Oct 8th 22:30 USD Nonfarm Payrolls (Sep) 500K