Australian Dollar (AUD) Fluctuates amid Bearish Trading Sentiment
The Australian Dollar (AUD) wavered against its peers yesterday as risk-off trading sentiment sapped appeal for the perceived-riskier asset.
Nevertheless, rising commodity prices supported the ‘Aussie’, as the prices of coal and iron ore increased. Various analysts consider such price rises will be short-lived as mining companies face soaring costs and a tight labour market.
Today, Australian inflation data could buoy AUD if it prints at 6.2%, as expected, or higher. The Reserve Bank of Australia (RBA) have struck a relatively bold tone recently and are likely to remain hawkish if inflation continues to climb.
New Zealand Dollar (NZD) Dips on Lack of Significant Data
The New Zealand Dollar (NZD) trended broadly lower on Tuesday as a lack of domestic data left the currency exposed to risk-off flows.
The ‘Kiwi’ may take direction from the ‘Aussie’ today as its sister currency is expected to firm following Q2’s AU inflation release.
Pound (GBP) Sinks as CBI Data Reveals Further Drop in Sales Volumes
The Pound (GBP) fell yesterday as the Confederation of British Industry (CBI) revealed that retail sales volumes fell in July for a fourth consecutive month.
Although distributive trades data printed above expectations, analysts’ interpretations were downbeat. Next month, retailers expect sales to decline at a faster pace, to the lowest reading since March 2021.
A lack of data likely leaves Sterling to be drive by domestic politics today. Any developments in the contest for the UK premiership may influence GBP trading, potentially weighing upon the currency.
Euro (EUR) Dented by Recession Fears
The Euro (EUR) dropped against the majority of its peers on Tuesday amid fresh fears of an imminent Eurozone recession.
This came amid concerns over European energy security as Russia moved to further reduce gas flows through the Nord Stream pipeline to Germany.
German consumer confidence could affect EUR trading today – if morale weakens as expected, the single currency may accrue further losses.
US Dollar (USD) Benefits from Safe-Haven Appeal
The US Dollar (USD) climbed yesterday as risk-off flows drew support to the safe-haven currency.
This came as the IMF slashed its global growth forecast and warned risk to the outlook remain ‘overwhelmingly tilted to the downside’.
Today, the US Dollar may maintain a bullish trajectory as the Federal Reserve is expected to deliver another aggressive rate hike as it concludes its latest interest rate decision.
Canadian Dollar (CAD) Fluctuates as Crude Oil Prices Climb
The Canadian Dollar (CAD) rose against several of its peers on Tuesday as oil prices strengthen. Recession fears had been weighing on the black gold, threatening to reduce demand for the commodity.
Data Releases
Jul 27th 11:30 AUD Inflation Rate (Q2) 6.2%
Jul 27th 16:00 EUR German Gfk Consumer Confidence (Aug) -28.9
Jul 27th 22:30 USD Durable Goods Orders (Jun) -0.4%
Jul 28th 04:00 USD Fed Interest Rate Decision 2.5%