Australian Dollar (AUD) Rises amid Risk-On Mood
The Australian Dollar (AUD) strengthened on Tuesday after the People’s Bank of China (PBoC) delivered a surprise rate cut to spur on economic growth.
The move lifted AUD, which trades as a proxy for the Chinese economy, while also adding to the upbeat market mood and further supporting the risk-sensitive ‘Aussie’.
Looking ahead risk appetite could drive AUD movement today. If the markets remain risk on, the Australian Dollar could climb higher.
New Zealand Dollar (NZD) Marches Higher amid Upbeat Markets
Likewise, the New Zealand Dollar (NZD) gained ground yesterday, though it experienced some volatility, amid the bullish risk tone.
Cooling US inflation in the evening added to the cheery mood in markets, further supporting the ‘Kiwi’.
Notable New Zealand data is in short supply today. Therefore, market risk appetite could continue driving NZD.
Pound (GBP) Climbs following Strong Jobs Report
The Pound (GBP) rallied during yesterday’s session after hotter-than-forecast jobs data saw markets price in more aggressive action from the Bank of England (BoE).
The British unemployment rate unexpectedly dropped while wage growth accelerated, raising the odds of further BoE interest rate hikes.
Turning to today, the UK’s latest GDP data is in the spotlight. Could a recovery in the British economy boost the Pound?
Euro (EUR) Mixed amid Lack of Data
The Euro (EUR) traded without any clear trajectory on Tuesday as a lack of data left the common currency struggling for direction.
EUR’s negative correlation with the US Dollar (USD) lent the currency some support. However, the Euro’s safer status saw it slip against riskier peers.
This evening, Eurozone industrial production is forecast to show an improvement in April following March’s slump. This could buoy the single currency.
US Dollar (USD) Tumbles as Inflation Cools
The US Dollar weakened yesterday, with a risk-on market mood sapping demand for the safe-haven ‘Greenback’.
Further headwinds hit USD overnight. US inflation cooled in May, as expected, solidifying expectations that the Federal Reserve will hit pause on its rate hiking cycle.
USD could be quiet today as markets brace for the Fed interest rate announcement, which takes place in the early hours of tomorrow morning. A policy pause could see USD slide.
Canadian Dollar (CAD) Stumbles amid Weaker Crude
The commodity-linked Canadian Dollar (CAD) was on the back foot on Tuesday following a slide in oil prices this week. A modest recovery in crude helped cushion losses for CAD later in the session.
With Canadian economic data still absent tomorrow, crude prices could continue to impact the ‘Loonie’. Will further losses dent the ‘Loonie’?
Data Releases
June 14th 16:00 GBP GDP (Apr) 0.2%
June 14th 19:00 EUR Industrial Production (Apr) 0.8%
June 14th 22:30 USD PPI (May) -0.1%
June 15th 04:00 USD Fed Interest Rate Decision 5.25%