Australian Dollar (AUD) Firms on Global Growth Hopes
The Australian Dollar (AUD) got off to a strong start this week, with the risk-sensitive currency being underpinned by an upbeat mood.
AUD investors were cheered by the possibility of more moderate US interest rate hikes leading to strong global growth.
Coming up today is the publication of Australia’s latest consumer confidence index. Will a rebound in sentiment this month help to underpin AUD’s gains?
New Zealand Dollar (NZD) Strengthens in Upbeat Trade
The New Zealand Dollar (NZD) also firmed on Monday as a risk-on impulse underpinned demand for the high-yield ‘Kiwi’.
A lull in domestic data will likely see movement in the ‘Kiwi’ remain linked to market risk appetite through today’s session.
Pound (GBP) Wavers amid Improving Sentiment
Trade in the Pound (GBP) was mixed yesterday. Sterling initially benefitted from the improving market mood.
However, the bulk of these gains later faded overnight as GBP investors feared the collapse of Silicon Valley Bank (SVB) could throw a curveball to Chancellor Jeremy Hunt a couple of days before he unveils his Spring Budget.
The UK will publish its latest jobs report later this evening. Will another strong wage growth reading bolster Bank of England (BoE) rate hike bets and help to lift the Pound?
Euro (EUR) Subdued in Risk-On Trade
The Euro (EUR) traded sideways on Monday as a risk-on mood offset any gains stemming from the single currency’s negative correlation with the US Dollar (USD).
EUR investors also appeared reluctant to make any aggressive bets ahead of the European Central Bank’s (ECB) upcoming interest rate decision.
With Eurozone data thin on the ground, any movement in the Euro may remain limited through today’s session.
US Dollar (USD) Nosedives on Falling Fed Rate Hike Bets
The US Dollar remained firmly on the defensive yesterday, with the ‘Greenback’ plummeting as investors repriced their expectations for the Federal Reserve’s next interest rate decision.
The fallout from the collapse of SVB saw some USD investors even go so far as to predict the Fed will leave interest rates on hold at its March meeting.
The US will publish its latest consumer price index later tonight. Could another stronger-than-expected US inflation print revive Fed rate hike bets and lift the US Dollar?
Canadian Dollar (CAD) Undermined by Slump in Oil Prices
The Canadian Dollar (CAD) stumbled on Monday, with the commodity-linked currency falling in tandem with oil prices, which fell to a new year-to-date low.
In the absence of any notable Canadian data, movement in the ‘Loonie’ may remain tied to oil price dynamics, potentially leading to more losses for CAD if the selloff persists.
Data Releases Data Releases
Mar 14th 09:30 AUD Consumer Confidence (Mar) 79.1
Mar 14th 17:00 GBP Unemployment Rate (Jan) 3.8%
Mar 14th 17:00 GBP Average Earnings (Jan) 6.6%
Mar 14th 10:30 USD Inflation Rate (Feb) 6%