Australian Dollar (AUD) Gains as China Seeks to Shore Up Diplomatic Ties
The Australian Dollar (AUD) firmed on Monday after news that China was seeking to improve its diplomatic ties with Australia. A risk-on mood also boosted the ‘Aussie’.
China’s rocky reopening continued to cap gains for AUD however, as Covid cases continued to surge.
The minutes from the Reserve Bank of Australia’s (RBA) latest meeting could bolster AUD today if the central bank signals further rate hikes.
New Zealand Dollar (NZD) Pulled Lower by Weak Consumer Confidence
The New Zealand Dollar (NZD) slipped on Monday. A fall in consumer confidence to a record low weighed on the ‘Kiwi’, as did a slowdown in the country’s services sector.
A slip in business confidence today could weigh on NZD if sentiment remains downbeat. A forecast widening of NZ’s trade deficit could also pull the ‘Kiwi’ lower.
Pound (GBP) Firms Despite Manufacturing Output Slump
The Pound (GBP) firmed yesterday. A healthy risk appetite boosted Sterling against its rivals. Optimism over fresh attempts to avert further NHS strikes also inspired confidence in GBP.
A continued slump in manufacturing sector output capped gains for the currency, however.
With no significant data today, GBP is set to be affected by risk appetite and any further industrial action.
Euro (EUR) Slips amid Kyiv Drone Strikes
The Euro (EUR) ticked lower on Monday. The single currency struggled amid a risk-on mood. Drone strikes on Kyiv also kept EUR on the defensive.
EUR found some support from an above-forecast rise in German business confidence however, as well as hawkish comments from European Central Bank (ECB) officials.
An expected slip in German PPI last month could weaken the euro today if it causes markets to pare back ECB rate hike bets.
US Dollar (USD) Drops amid Risk-On Market Mood
The US Dollar (USD) slid yesterday. The safe-haven ‘Greenback’ edged lower amid a risk-on market mood.
Fears of a global recession helped to temper USD losses, however. Additionally, the Federal Reserve’s hawkish stance helped limit losses for the currency.
With no significant data today, the US Dollar is likely to remain sensitive to any shifts in risk appetite.
Canadian Dollar (CAD) Bolstered by Oil Price Climb
The Canadian Dollar (CAD) rose on Monday amid climbing crude oil prices. An unexpected slip in November’s PPI capped gains for the ‘Loonie’, however.
A forecast rise in domestic retail sales in October could push CAD higher today, as well as any shifts in oil prices.
Data Calendar
Dec 20th 07:45 NZD Balance of Trade (Nov) NZ$-21.29bn
Dec 20th 10:00 NZD ANZ Business Confidence (Dec) -52
Dec 20th 10:30 AUD RBA Meeting Minutes
Dec 20th 17:00 EUR German PPI (Nov) -2.5%
Dec 20th 23:30 CAD Retail Sales (Oct) 1.5%
Dec 21st 01:00 EUR Consumer Confidence (Dec) -22