Australian Dollar (AUD) Slips amid Risk Aversion
The risk-sensitive Australian Dollar (AUD) came under pressure from a retreat in global risk appetite yesterday.
However, the ‘Aussie’ found some support from a jump in iron ore prices. Lingering tailwinds following above-forecast Chinese growth data on Tuesday also aided AUD.
The interest rate decision from the People’s Bank of China (PBoC) may shore up the ‘Aussie’ today.
New Zealand Dollar’s (NZD) Losses Limited by China Growth Hopes
A cautious market mood dented confidence in the risk-sensitive New Zealand Dollar (NZD) on Wednesday.
Lingering hopes for China’s economic recovery following strong GDP data on Tuesday helped limit losses for the ‘Kiwi’.
A forecast rise in first-quarter inflation today could lift NZD, if the data prints as forecast.
Pound (GBP) Jumps after Hotter-than-Forecast Inflation
Renewed Bank of England (BoE) interest rate hike bets lifted the Pound (GBP) yesterday following a hotter-than-expected consumer price index.
UK inflation remained in double digits at 10.1%, rather than easing to 9.8%, prompting expectations that the BoE will raise interest rates again next month.
Movement could be more subdued today amid a lack of economic data. Ongoing BoE bets could help Sterling hold strong.
Euro (EUR) Underpinned by Core Inflation Uptick
A retreat in global risk appetite saw the Euro (EUR) firm on Wednesday. The final reading of Eurozone inflation kept pressure on the single currency, however, as March’s CPI fell.
Stubbornly high core inflation underpinned EUR, though. The rise in core goods prices kept bets on further European Central Bank (ECB) rate hikes strong.
The Euro could fall into negative territory today if German PPI cools as forecast. The ECB’s latest monetary policy accounts could cushion losses for EUR.
US Dollar (USD) Climbs as Bets on Fed Hike Grow
The US Dollar (USD) was bolstered by the prospect of further Federal Reserve rate hikes on Wednesday.
Hawkish comments from Fed policymaker James Bullard added to rate rise bets. Additionally, the safe-haven ‘Greenback’ was pushed higher by a risk-off mood.
USD could see its gains capped by a forecast uptick in jobless claims today. The evidence of labour market slackness could dent Fed rate hike bets.
Canadian Dollar (CAD) Slips as Interest Rate Bets Hit Oil Prices
A sharp drop in crude oil prices pulled the commodity-linked Canadian Dollar (CAD) lower yesterday. A greater-than-forecast dip in PPI added to losses for the ‘Loonie’.
CAD could drop again today if oil prices continue to be affected by global interest rate hike expectations.
Apr 20th 08:45 NZD Inflation Rate (Q1) 1.7%
Apr 20th 16:00 EUR German PPI (Mar) -0.5%
Apr 20th 21:30 EUR ECB Monetary Policy Accounts Meeting
Apr 20th 22:30 USD Initial Jobless Claims (15/Apr) 240,000
Apr 21st 00:00 EUR Consumer Confidence (Apr) -18.5