Australian Dollar (AUD) Underpinned by Risk Appetite
The risk-sensitive Australian Dollar (AUD) initially rose yesterday amid an upbeat mood. Hints of more policy tightening from incoming Reserve Bank of Australia (RBA) Governor Michele Bullock also aided AUD.
However, the ‘Aussie’ fluctuated during European trade as market volatility impacted the currency.
Turning to today, the latest consumer price inflation data could weigh on the ‘Aussie’. Economists expect Australian inflation to ease, which could dent RBA bets.
New Zealand Dollar (NZD) Wavers on Risk Appetite
The New Zealand Dollar (NZD) also initially firmed as a cautiously optimistic market mood buoyed the riskier ‘Kiwi’.
News of further economic support from the Chinese government cheered investors.
Looking ahead, without any data of note, the New Zealand Dollar could continue to trade on risk sentiment.
Pound (GBP) Wobbles amid Lack of Data
The Pound (GBP) fluctuated mostly sideways yesterday as a lack of notable UK data left Sterling without a clear direction.
After last week’s dismal economic data, Sterling remained near recent lows.
Turning to this evening, the latest consumer credit data from the Bank of England (BoE) could show how soaring borrowing costs are impacting lending figures. GBP may face headwinds.
Euro (EUR) Stumbles as German Consumer Confidence Falls
The Euro (EUR) came under moderate selling pressure during yesterday’s European session as German consumer confidence dropped to a four-month low.
However, EUR managed to regain lost ground later on thanks to the Euro’s strong negative correlation with a declining US Dollar (USD).
As for today, the latest Eurozone economic sentiment index and German inflation data could influence the Euro. A fourth consecutive decline in morale could push the Euro lower, potentially compounded by another easing of headline inflation in Germany.
US Dollar (USD) Slumps on Loosening Labour Market
The US Dollar traded erratically yesterday, shedding early gains after the latest JOLTs survey revealed that job openings in July reached the lowest levels since March 2021.
This was far below market expectations and marked a third consecutive month of falling job openings. Signs of a cooling labour market dented Federal Reserve rate hike bets, with USD spiralling lower.
Fresh jobs data out this evening could see USD fall further. Markets expect the latest ADP employment change figure to show a notable slowdown in job creation.
Canadian Dollar (CAD) Fluctuates amid Wavering Oil Prices
The Canadian Dollar (CAD) traded erratically against its peers yesterday as volatile oil prices kept the commodity-linked ‘Loonie’ under pressure.
Looking ahead, without any CAD data to go by, oil price dynamics could be the biggest driver of movement in the Canadian Dollar.
Data Releases
Aug 30th 11:30 AUD Monthly CPI Indicator (Jul) 5.2%
Aug 30th 18:30 GBP BoE Consumer Credit (Jul) £1.3bn
Aug 30th 19:00 EUR Economic Sentiment (Aug) 93.7
Aug 30th 22:00 EUR DE Inflation Rate (Aug) 6%
Aug 30th 22:15 USD ADP Employment Change (Aug) 195,000