Australian Dollar (AUD) Ticks Lower amid Surge in China Covid-19 Cases
The Australian Dollar (AUD) edged lower on Friday despite a return of global risk appetite. A continued surge in China’s Covid-19 case levels dented confidence in the ‘Aussie’. A drop in iron ore prices also pulled AUD lower.
Additionally, expectations of a dovish pace of policy tightening from the Reserve Bank of Australia (RBA) weighed on the currency.
With no significant data today, AUD’s movements are likely to be governed by shifts in risk appetite.
New Zealand Dollar (NZD) Boosted by Risk-On Mood
The New Zealand Dollar (NZD) was bolstered by a risk-on market mood at the end of last week. The ‘Kiwi’ also benefited from a weaker US Dollar (USD).
Looking ahead any movement in the ‘Kiwi’ today is likely to remain linked to risk appetite.
Pound (GBP) Firms after Above-Forecast Retail Sales Figures
The Pound (GBP) gained against its peers on Friday. Above-forecast retail sales figures acted as tailwind for Sterling. October’s sales volumes rose by 0.6%.
The UK’s bleak economic outlook kept gains for GBP limited, however. Following Thursday’s Autumn statement, economists have highlighted the impact the proposed measures could have on household spending.
A speech by Bank of England (BoE) policymaker Jon Cunliffe could lend support to Sterling if he confirms further rate hikes from the BoE.
Euro (EUR) Drops as ECB Lagarde Promises to Hike Rates Despite Risks
The Euro (EUR) slipped amid a risk-on market mood and a stronger US Dollar (USD) on Friday.
Mixed comments from European Central Bank (ECB) President Christine Lagarde also caused movement in EUR. Lagarde’s commitment to further interest rate hikes underpinned the Euro, although signals that the ECB would act regardless of recessionary risks kept pressure on EUR.
Another speech from Lagarde today could cause further losses for the Euro. A downturn in German PPI could have a similar effect.
US Dollar (USD) Gains after Hawkish Fedspeak
The US Dollar (USD) firmed against its peers on Friday despite a healthy risk appetite in the markets. A downturn in US Treasury bond yields also kept pressure on USD.
Hawkish comments from Federal Reserve policymaker underpinned the currency, however. Board member Susan Collins signalled that further interest rate hikes were still to come.
USD will see no major data releases today. Risk appetite and Fed rate hike bets could prompt movement in the currency.
Canadian Dollar (CAD) Slumps as Oil Prices Tumbles
The Canadian Dollar (CAD) dropped on Friday. The commodity-tied ‘Loonie’ was pulled lower by tumbling oil prices.
CAD is likely to be affected by any further fluctuations in the price of oil today.
Data Releases
Nov 21st 05:30 EUR ECB President Lagarde Speech
Nov 21st 17:00 EUR German PPI (Oct) 0.9%
Nov 21st 19:05 GBP BoE Cunliffe Speech