Australian Dollar (AUD) Falls amid Fears of Chinese Deflation
The Australian Dollar (AUD) slipped on Friday amid a mixed risk environment. A softer reading of Chinese inflation weighed on the ‘Aussie’.
On the other hand, losses for AUD were limited by the easing of China’s Covid restrictions.
A forecast slump in October’s job advertisements could see AUD slip at the start of this week if investors view it as a sign of a cooling labour market.
New Zealand Dollar (NZD) Boosted by Commodities Rise
The New Zealand Dollar (NZD) was bolstered by strong commodity prices at the end of last week. Although mixed risk appetite tempered these gains ‘Kiwi’ somewhat.
With no significant data today, NZD is likely to be affected by any shifts in risk appetite.
Pound (GBP) Bolstered by High Inflation Expectations
The Pound (GBP) climbed on Friday despite a lack of significant data. Sterling benefitted from market bets for a 50bps interest rate hike from the Bank of England (BoE).
Sterling also rose after public inflation expectations climbed to fresh highs in November.
A predicted expansion in the UK’s economy in October could boost Sterling today. A forecast widening in the UK’s trade deficit could cap any gains, however.
Euro (EUR) Slips Despite Signs of Russian Desire to Negotiate
The Euro (EUR) slid at the end of last week. The single currency saw losses amid a stronger US Dollar (USD) and a lack of significant data.
Bets on a possible 75bps interest rate hike from the European Central Bank (ECB) limited EUR’s losses, however. The Euro also found support after conciliatory comments from Russian President Vladimir Putin.
The Euro will see no significant today. The single currency is likely to be affected by market mood and ECB rate hike bets.
US Dollar (USD) Rises as PPI Figures Tick Higher
Trade in the US Dollar (USD) was mixed on Friday, amid fluctuating market risk appetite.
The latest PPI figures saw prices climb higher in November which pushed USD higher. Additionally, an above-forecast rise in consumer confidence also reflected positively on USD.
A forecast widening of the US government’s budget deficit could weigh on USD today if the monthly statement prints as forecast.
Canadian Dollar (CAD) Slides as Oil Prices see Sharp Weekly Drop
The Canadian Dollar (CAD) dropped on Friday as a mild uptick in oil prices was not enough to offset a 10% drop on the week.
Looking ahead, a speech from Bank of Canada (BoC) Tiff Macklem could push CAD lower. Oil price fluctuations could also prompt movement in the currency.
Data Releases
Dec 12th 11:30 AUD ANZ Job Advertisements (Oct) -1.2%
Dec 12th 17:00 GBP GDP (Oct) 0.4%
Dec 12th 17:00 GBP Balance of Trade (Oct) £-2.3bn
Dec 12th 17:00 GBP Industrial Production (Oct) -2.7%
Dec 13th 17:00 USD Monthly Budget Statement $-95bn
Dec 13th 06:40 CAD BoC Gov Macklem Speech