Australian Dollar (AUD) Hampered by Weak Services Data
The Australian Dollar (AUD) trended in a mixed range on Friday, following a disappointing data release. The Ai Group services index printed lower than expected for October, revealing the third straight month of contraction in the service sector.
The Reserve Bank of Australia (RBA) published its statement on monetary policy shortly after, expanding upon what was said earlier in the week. The report reiterated that the Reserve Bank Board do not see the latest data and forecasts warranting an increase in the cash rate in 2022.
Looking ahead, a lack of AU data in today’s session leaves the ‘Aussie’ to trade on risk sentiment and external factors.
Pound (GBP) Extends Losses on BoE Disappointment
The Pound (GBP) slumped against the majority of its peers at the end of the week, as GBP sentiment remained subdued over the Bank of England (BoE)’s dovish policy decision.
A lack of significant data on Friday left traders to reflect on the central bank’s choice not to tighten – Governor Andrew Bailey faced widespread criticism for misleading markets with hawkish messaging.
Into today, the Pound is likely to remain under pressure as Brexit-related tensions over the Norther Ireland protocol continue.
Euro (EUR) Fluctuates Following Poor Retail Sales
The Euro (EUR) traded unevenly on Friday as a clutch of disappointing data from Germany and the Eurozone weighed upon the single currency.
Industrial production in the bloc’s biggest economy decreased, while construction activity missed forecasts; retail sales in the Eurozone for the month of September also fell on the month previous.
A lack of data today leaves the Euro open to losses: the single currency may find direction on risk-sentiment.
US Dollar (USD) Strengthens on Non-Farm Payrolls
The US economy added 531K jobs according to its latest non-farm payrolls, exceeding expectations of 450K and boosting the US Dollar (USD).
The ‘Greenback’ climbed on Friday afternoon as the country’s unemployment rate declined, boosting the currency further following the Federal Reserve’s decision to taper its bond-buying programme.
In the absence of notable data releases, the US Dollar is likely to trade on risk sentiment through today’s session.
Canadian Dollar (CAD) Firms as Unemployment Falls
The Canadian Dollar (CAD) rose at the end of the week as the Canadian unemployment rate unexpectedly dropped to 6.7% in October, down from 6.9% in September, and indicated a decline for the fifth straight month.
The ‘Loonie’ also faced pressure as WTI crude depreciated: oil prices slumped on Friday from Thursday’s midday highs.
New Zealand Dollar (NZD) Gains as European Session Closes
The New Zealand Dollar (NZD) firmed on Friday despite a lack of data, as ‘Kiwi’ sentiment rallied. NZ shrugged off weakness in the Australian Dollar and Chinese headwinds caused by a shortfall in electricity and factory workers.