Australian Dollar (AUD) Wavers as China Cuts Interest Rates
The Australian Dollar (AUD) traded without a clear direction on Monday as a lack of economic data left the risk-sensitive ‘Aussie’ vulnerable to choppy market trade.
Investors were left disappointed that the People’s Bank of China (PBoC) opted to cut interest rates less than expected. The gloom from China’s lethargic economic recovery continues to hang over markets.
With no more data out today, risk sentiment will likely continue to be the main driver of movement.
New Zealand Dollar (NZD) Undermined by Widening Trade Deficit
Meanwhile, the New Zealand Dollar (NZD) initially slumped yesterday in the wake of the latest trade balance data.
New Zealand’s trade deficit widened further than expected, with exports declining to a five-month low as China’s slowing economic recovery dented demand.
Looking ahead, without any major data, NZD could be left to trade on risk appetite today. Any further concerning news from China could sap demand for the ‘Kiwi’.
Pound (GBP) Listless amid Uncertain Economic Outlook
The Pound (GBP) traded narrowly yesterday as a lack of data left investors to mull over the fragility of the UK economy.
While Bank of England (BoE) interest rate hike bets have recently boosted GBP, there are fears that higher borrowing costs will tip the UK into a recession.
Coming up, an expected decline in the Confederation of British Industry’s (CBI) order book balance could dent Sterling tonight.
US Dollar (USD) Quiet as Investors Ponder Fed Monetary Policy
The US Dollar (USD) struggled to attract demand at the start of the week as a thin trading calendar left it exposed to the shifting market sentiment.
Furthermore, USD investors were likely holding back bets ahead of the Federal Reserve’s Jackson Hole Symposium later this week.
Turning to today, a lack of US data releases could leave the safe-haven ‘Greenback’ to trade on market sentiment. Will a souring mood boost USD?
Euro (EUR) Rangebound in Absence of Data
The Euro (EUR) traded narrowly yesterday amid a lack of market-moving economic data.
EUR’s negative correlation with USD added to the single currency’s mixed movement, as the ‘Greenback’ wavered through the session.
Without any further data today, risk sentiment and lingering concerns over the Eurozone economy could keep the single currency under pressure.
Canadian Dollar (CAD) Fluctuates amid Wavering Oil Prices
The Canadian Dollar (CAD) also struggled to find sustained demand yesterday amid turbulence in the oil markets. Crude spiked above $82 per barrel before trimming its gains by over $1.
Looking ahead, oil could continue to drive CAD movement today. Will the volatility continue?
Data Releases
Aug 22nd 20:00 GBP CBI Industrial Trends Orders (Aug) -13