Australian Dollar (AUD) Dented as Sentiment Weakens
The Australian Dollar (AUD) initially fell on Tuesday, after domestic data reported a drop in both consumer and business confidence.
However, the ‘Aussie’ was able to claw back the majority of these losses overnight as market risk appetite recovered at the start of the US session.
In the absence of any notable AUD data, movement in the ‘Aussie’ is likely to be driven by investor risk appetite. Will a continued improvement in market sentiment underpin AUD exchange rates?
New Zealand Dollar (NZD) Rallies on RBNZ Rate Hike Speculation
The New Zealand Dollar (NZD) enjoyed strong support yesterday, the currency being underpinned by an improving market mood and the expectations the Reserve Bank of New Zealand (RBNZ) will continue to raise interest rates.
Looking ahead, will a bullish market mood extend the ‘Kiwi’s gains?
Pound (GBP) Rocked by BoE Warning
The Pound (GBP) got off to a poor start on Tuesday, after the Bank of England (BoE) warned the UK faces a ‘material risk’ to financial stability as it widened its emergency bond purchases.
Sterling was able to recoup most of these losses through the European trading session, aided by some upbeat domestic employment figures.
The publication of the latest UK GDP figures could cut this recovery short, however. Data released later this afternoon is expected to show the UK economy stalled in August.
Euro (EUR) Struggles amid Ongoing Ukraine Concerns
The Euro (EUR) was muted yesterday. The single currency stumbling amid concerns that an escalation of the war in Ukraine could place even more pressure on the Eurozone economy.
EUR sentiment came under further pressure in the wake of comments from the International Monetary Fund (IMF) warning Europe’s energy shock is not transitory.
A speech by European Central Bank (ECB) President Christine Lagarde will likely be the focus for EUR investors today. Could a hawkish outlook reflect positively on the single currency?
US Dollar (USD) Mixed amid Fluctuating Treasury Yields
The US Dollar (USD) traded without a strong directional bias on Tuesday, as US Treasury yields fluctuated.
Also limiting the ‘Greenback’ was a modest pick up in market risk appetite overnight.
In the spotlight today will be the publication of the minutes from the Fed’s September policy meeting. If they reaffirm expectations the US central bank will continue to raise interest rates through to the end of the year, the US Dollar is likely to strengthen.
Canadian Dollar (CAD) Subdued as Oil Prices Slide
The Canadian Dollar (CAD) struggled to attract support yesterday. The appeal of the commodity-linked currency being undermined by a pullback in oil prices.
A lull in notable CAD data will likely see movement in the ‘Loonie’ remain tied to oil price dynamics today.
Data Releases
Oct 12th 16:00 GBP GDP (Aug) 0%
Oct 12th 19:00 EUR Industrial Production (Aug) 0.6%
Oct 12th 22:30 USD PPI (Sep) 0.2%
Oct 12th 23:30 EUR ECB Lagarde Speech
Oct 13th 04:00 USD FOMC Minutes