Australian Dollar (AUD) Trends Higher amid RBA Rate Hike Bets
The Australian Dollar (AUD) trended higher at the end of last week, holding at multi-month highs against many of its peers, as the ‘Aussie’ found support from bets on further rate hikes from the Reserve Bank of Australia (RBA).
However, cooler fourth-quarter PPI figures capped gains for AUD.
AUD will see no data releases today, meaning that the risk-sensitive currency is likely to be affected by RBA rate hike bets and shifts in the market mood.
New Zealand Dollar’s (NZD) Losses Limited by Business Confidence Rise
The New Zealand Dollar (NZD) saw some turbulence on Friday as a shifting market mood impacted the risky ‘Kiwi’.
A larger-than-expected improvement in the latest business confidence figures lent support to NZD, however, preventing any steep losses.
Looking to today, a forecast narrowing in the country’s trade deficit could bolster the New Zealand Dollar.
Pound (GBP) Sluggish amid UK Growth Concerns
The Pound (GBP) fell on Friday amid a lack of significant data for the currency. The UK’s poor economic outlook weighed on Sterling at the end of last week, with a speech on growth from the Chancellor Jeremy Hunt failing to cheer investors.
Market bets on a 50bps interest rate hike from the Bank of England (BoE) this week limited losses for GBP, however.
There are no data releases for Sterling today. Movement in the Pound is likely to be driven by BoE rate hike bets and forecasts for the UK economy.
Euro (EUR) Falls as Russia-Ukraine Conflict Escalates
The Euro (EUR) dropped on Friday as concerns about the escalating Russia-Ukraine conflict pushed EUR lower.
A speech from European Central Bank (ECB) President Christine Lagarde failed to support EUR, as Lagarde did not mention monetary policy.
Fourth-quarter German GDP could affect the Euro today. Economists expect Europe’s largest economy to have stalled, which may weigh on EUR. Any surprise results will likely have a big impact.
US Dollar (USD) Wavers following Mixed Data
The US Dollar (USD) was mixed after the latest reading of the core PCE price index on Friday. The Federal Reserve’s preferred measure of inflation rose month on month, pointing to the possibility of further rate hikes.
However, heightened fears of an economic downturn brought the prospect of higher interest rates into question. A larger-than-expected drop in personal spending led some economists to speculate that the US economy was already in a recession.
With no significant data today, movement in the safe-haven US Dollar is set to be affected by rate hike bets and risk appetite.
Canadian Dollar (CAD) Gains as Oil Prices Climb
The Canadian Dollar (CAD) edged higher on Friday. The crude-linked ‘Loonie’ found support from bullish oil prices, although saw gains limited by bets on a rate hike pause from the Bank of Canada (BoC).
In the absence of Canadian data today, movement in CAD is likely to be driven by oil price dynamics.
Data Releases
Jan 30th 07:45 NZD Balance of Trade (Dec) NZ$-1.1bn
Jan 30th 19:00 EUR German GDP Growth Rate (Q4) 0%
Jan 30th 20:00 EUR Economic Sentiment 96.4