Australian Dollar (AUD) fall as China Threatens Countermeasures
The Australian Dollar (AUD) fell against its peers yesterday amidst growing tensions between the US and China.
Australia’s biggest trading partner warned that the country ‘reserves the right to take necessary countermeasures on US sanctions’ – comments from China’s foreign Minister Wang Yi following America’s blacklisting of 12 Chinese companies on Wednesday.
Looking ahead, Australian retail sales are likely to influence ‘Aussie’ trading today – an expected acceleration of sales growth in October is likely to reflect positively on AUD exchange rates.
Pound (GBP) Tumbles Despite Haskel Comments, CBI Data
The Pound (GBP) was subdued on Thursday as hawkish comments from Monetary Policy Committee (MPC) member Jonathan Haskel failed to bolster Sterling sentiment.
Haskel’s support for an interest rate hike ‘if the labour market stays tight’ joined better-than-expected distributive trades data in providing upside, but GBP remained depressed on Brexit headwinds and the threat of rising Covid cases in the new year.
A lack of significant data today leaves the Pound to trade on external factors, including risk sentiment and Brexit developments.
Euro (EUR) Buoyed by ECB Accounts, Hawkish Rhetoric
The Euro (EUR) gained through yesterday’s session despite a slightly lower-than-expected GDP print from Germany.
Trading sentiment was supported by hawkish rhetoric from European Central Bank (ECB) policymakers Luis De Guindos and Jens Weidmann, as well as fairly upbeat meeting accounts. Members of the ECB’s governing council agreed that net PEPP purchases should be expected to come to an end by March 2022.
Speeches from ECB President Christine Lagarde and policymaker Isabel Schabel may influence Euro direction today.
US Dollar (USD) Trades Mixed on US Public Holiday
The US Dollar (USD) traded in a mixed range on Thursday as the Thanksgiving break restricted market action.
Investors digested a range of midweek data, from the Personal Consumption Expenditures (PCE) Price Index to initial jobless claims – the majority of US releases were upbeat, supporting the hawkish tone set by the Federal Open Market Committee (FOMC) minutes.
Into today, a lack of significant US data leaves the ‘Greenback’ to trade on risk sentiment – if Covid cases continue to rise in Europe, USD may accrue support on account of its safe-haven status.
Canadian Dollar (CAD) Finds Support despite Subdued Oil Markets
The price of WTI crude oil fell slightly in yesterday’s session, retreating from a weekly high set on Wednesday. Liquidity conditions were thin as a result of US market closures.
The Canadian Dollar (CAD) gained, however, as a crude output hike from the Organisation of Petroleum Exporting Countries and their allies (OPEC+) remained unconfirmed.
New Zealand Dollar (NZD) Slumps in Spite of Rate Hike
The New Zealand Dollar (NZD) tumbled on Thursday, following the Reserve Bank of New Zealand (RBNZ)’s decision to raise the Official Cash Rate (OCR) to 0.75%.
Bullish investors had hoped for an increase of 50bps rather than 25 – their disappointment weighed upon the ‘Kiwi’.
Data Releases
Nov 26th 10:30 AUD Retail Sales Preliminary (Oct) 9.2%
Nov 26th 18:00 EUR ECB Lagarde Speech N/A