Australian Dollar (AUD) Fluctuates amid Muddled Economic Outlook
The NAB business confidence index rose unexpectedly yesterday, bringing some cushioning to the Australian Dollar (AUD).
However, deteriorating consumer confidence prevented AUD from strengthening against its peers during Tuesday’s session.
Risk appetite is likely to drive the ‘Aussie’ today, as a short supply of data leaves the risk-sensitive currency exposed to the market mood.
New Zealand Dollar (NZD) Dampened by Risk-Averse Trade
Tuesday saw the risk-sensitive New Zealand Dollar (NZD) struggle to attract support amid a downbeat session.
Due to a light data calendar, the ‘Kiwi’ was left vulnerable to shifts in global risk appetite, which deteriorated over the day’s trade.
Owing to a short supply of impactful data, the ‘Kiwi’ is likely to trade on risk sentiment again today. Could bullish trade boost NZD?
Pound (GBP) Dented by Disappointing Employment Data
The publication of July’s employment data weighed on the Pound (GBP) yesterday, despite record-high wage growth.
The unemployment rate rose to a near two-year high, indicating a continued cooldown in the UK labour market. Because of this, investors began to pare back their bets on further tightening from the Bank of England (BoE).
The UK’s latest GDP data is due to print this afternoon, with economists anticipating a 0.2% contraction in July. This could weigh heavily on GBP over the session by sparking recession anxieties.
Euro (EUR) Uninspired by Improving German Sentiment
A surprise improvement in the German ZEW economic sentiment index failed to inspire the Euro (EUR) yesterday.
While the index suggested a rosier outlook, the report showed this came from expectations of stabilising interest rates. Furthermore, the German economic outlook fell to its lowest levels in three years, undermining EUR.
The Eurozone’s industrial production data for July is due this evening. A 0.7% decrease is forecast, which could weigh on the common currency.
US Dollar (USD) Buoyed by Souring Market Mood
During yesterday’s session, the safe-haven US Dollar (USD) enjoyed modest support from investors, care of the risk-averse market mood.
However, USD’s gains were likely muted by a hesitancy to support the currency ahead of tonight’s consumer price index.
While headline inflation is forecast to have risen in August, core inflation is forecast to have cooled, potentially bringing volatility to USD.
Canadian Dollar (CAD) Rallies as Production Cuts Boost Oil Prices
Rising oil prices lifted the commodity-linked Canadian Dollar (CAD) on Tuesday, with additional production cuts sending prices skyward.
The ‘Loonie’ may continue to rely on oil price dynamics to strengthen today, due to a lack of data releases.
Data Releases
Sep 13th 16:00 GBP GDP (Jul) -0.2%
Sep 13th 19:00 EUR Industrial Production (Jul) -0.7%
Sep 13th 22:30 USD Inflation Rate (Aug) 3.6%