Australian Dollar (AUD) Sustains Bullish Momentum
Thursday saw the risk-sensitive Australian Dollar (AUD) continue to charge above its peers, as the bullish trade continued. Expectations of fewer Federal Reserve rate hikes cheered markets.
This allowed the ‘Aussie’ to shrug off a sharp decline in Chinese exports, which suggested continued struggles in the superpower’s recovery.
Through today’s session, a lack of data releases may leave the ‘Aussie’ to trade on market mood. If trade remains upbeat, AUD rates could strengthen.
New Zealand Dollar (NZD) Climbs on Elevated Risk Appetite
Much like its neighbouring currency, the New Zealand Dollar (NZD) continued to gather pace during Thursday’s session as increased levels of risk appetite allowed the ‘Kiwi’ to climb above safer peers.
NZD’s gains came despite a deeper-than-forecast contraction in New Zealand manufacturing activity, though this may have limited the currency’s upside.
Over today’s session, market sentiment could continue to drive NZD exchange rates. The ‘Kiwi’ could hold strong if the mood stays positive.
Pound (GBP) Rallies despite Economic Contraction
On Thursday, the Pound (GBP) managed to shake off a 0.1% contraction in the latest GDP data to strengthen against many peers.
Despite shrinking, the UK economy performed better than expected in May, which led to markets increasing their bets on more aggressive action from the Bank of England (BoE).
Amid a lack of economic data today, the Pound could face mixed movement.
Euro (EUR) Cushioned by Negative US Dollar Correlation
While strengthening against some peers, the Euro (EUR) traded with an unclear direction over the course of Wednesday’s session.
The common currency’s negative correlation to a tanking US Dollar (USD) brought some cushioning, but a cheery mood hampered the safer Euro’s success.
The Eurozone’s latest balance of trade data is due to publish this afternoon. Could a decrease in the bloc’s trade deficit aid the Euro?
US Dollar (USD) Plunges to 15-Month Lows amid Cooling Inflation
After the US producer price index showed another meaningful cooldown, the US Dollar extended its selloff yesterday.
Annual PPI cooled from 0.9% to 0.1%, below forecasts of 0.4%, in the latest indication that US inflation is easing. This resulted in a further repricing of Federal Reserve interest rate rise bets, with USD tumbling to multi-month lows.
Tonight, the University of Michigan is set to publish its latest consumer sentiment index. An uptick is expected, which could bolster the ‘Greenback’.
Canadian Dollar (CAD) Curtailed by USD Weakness
The Canadian Dollar (CAD) weakened yesterday, as its close correlation to the declining US Dollar sapped sentiment.
The ‘Loonie’ may trade on oil price dynamics throughout today’s session. If prices manage to recover, the crude-linked CAD could rally.
Data Releases
Jul 14th 19:00 EUR Balance of Trade (May) €-7.6bn
Jul 15th 00:00 USD Michigan Consumer Sentiment (Jul) 65.5