Australian Dollar (AUD) Stumbles as China’s Private Sectors Disappoint
Downbeat economic data from China weighed on the Australian Dollar (AUD) yesterday, as a weakening Chinese economy could negatively impact Australian trade.
The latest meeting minutes from the Reserve Bank of Australia (RBA) failed to save the ‘Aussie’. Policymakers sounded cautious, despite having enacted a surprise interest rate rise at the bank’s last meeting.
Looking to today, the ‘Aussie’ could edge lower if the market mood remains cautious amid a lack of data.
New Zealand Dollar (NZD) Pulled Lower by Risk-Off Mood
The risk-sensitive New Zealand Dollar (NZD) lost ground yesterday as risk aversion swept markets.
Poor industrial and retail sector data from China deepened losses for the ‘Kiwi’.
Thin trading conditions for NZD today could see a downbeat mood continue to put pressure on the currency.
Pound (GBP) Falls as UK Labour Market Cools
The Pound (GBP) declined yesterday amid evidence of slack in the UK labour market. Unemployment unexpectedly rose in March while wage growth printed below forecasts.
The data prompted a further pullback in Bank of England (BoE) rate hike bets, thereby denting GBP. However, wage growth remained elevated, which limited Sterling’s losses.
A speech from BoE Governor Andrew Bailey this evening could hurt GBP. Following the bank’s rate decision last week, Bailey weakened the Pound by saying he expected UK inflation to fall sharply.
Euro (EUR) Wavers as Fears of German Recession Grow
A greater-than-expected fall in Germany’s ZEW economic sentiment index first saw the Euro (EUR) stumble yesterday. The data increased fears of a recession in the Eurozone’s largest economy.
However, the safer single currency resisted losses thanks to a downbeat market mood, which kept EUR afloat against its riskier peers.
Looking ahead, the Eurozone’s final inflation rate this evening could impact the common currency if it differs from preliminary estimates. Could a downward revision see EUR slump?
US Dollar (USD) Zigzags as Debt Ceiling Crisis Worsens
The US Dollar (USD) fluctuated on Tuesday. The ‘Greenback’ initially fell as the US debt ceiling crisis rattled USD investors. Below-forecast retail sales volumes for April also hobbled the currency.
However, a softer risk tone helped the safe-haven ‘Greenback’ to regain lost ground. Hawkish remarks from Federal Reserve rate-setter Loretta Mester also boosted USD.
This morning, a speech from Fed official Raphael Bostic could lift the US Dollar if he again advocates further policy tightening.
Canadian Dollar (CAD) Lifted by Above-Forecast CPI Data
A hotter-than-forecast CPI reading bolstered the Canadian Dollar (CAD) yesterday, with inflation unexpectedly accelerating. A rise in oil prices also lent support to the commodity-tied ‘Loonie’.
CAD could catch more bids today if oil prices continue to improve.
May 17th 09:00 USD Fed Bostic Speech
May 17th 19:00 EUR Inflation Rate Final (Apr) 7%
May 17th 19:50 GBP BoE Gov Bailey Speech
May 18th 01:15 EUR ECB Guindos Speech