Australian Dollar (AUD) Rises amid Risk-On Trade
Yesterday’s elevated levels of risk appetite propelled the Australian Dollar (AUD) higher against safer assets.
Markets were upbeat amid growing signs that inflation is easing and central banks around the world may be at the end of their tightening cycles.
This morning, the Reserve Bank of Australia (RBA) is set to publish its latest bulletin. If it indicates optimism over the Australian economy, AUD could strengthen.
New Zealand Dollar (NZD) Edges Higher amid Upbeat Mood
Yesterday, the risk-sensitive New Zealand Dollar (NZD) firmed amid a tentatively upbeat market mood.
However, the continued scarcity of impactful data served to limit NZD’s gains over the session.
Turning to today, the ‘Kiwi’ could start to stabilise after the movement triggered by New Zealand’s GDP data and the Federal Reserve interest rate decision.
Pound (GBP) Crumbles as Inflation Cools
UK inflation unexpectedly cooled yesterday, weakening the Pound (GBP) against its peers.
The surprise fall prompted investors to readjust their Bank of England (BoE) interest rate hike bets. With predictions now balanced on a knife-edge, GBP endured additional pressure.
The BoE takes the stage tonight. Expectations of dovish forward guidance are mounting, which could limit GBP over today’s trade.
Euro (EUR) Rangebound amid Lack of Data Catalysts
Sideways trade characterised the Euro (EUR) on Wednesday, as a lack of data left the common currency rudderless.
Additionally, the cheery market mood exerted some downward pressure on the safer Euro.
Later tonight, European Central Bank (ECB) President Christine Lagarde is scheduled to speak. Could dovish remarks dent the Euro?
US Dollar (USD) Muted Ahead of Fed Decision
Tepid trade limited the US Dollar (USD) yesterday, as investors awaited the latest interest rate decision from the Federal Reserve.
Markets anticipated a pause in the Fed’s tightening cycle, shifting the focus to its forward guidance, which yielded additional volatility.
Over today, the US Dollar is likely to continue trading in line with the fallout from the latest Fed interest rate decision. However, an expected uptick in jobless claims could put fresh pressure on USD.
Canadian Dollar (CAD) Capped by Wobbling Oil Prices
The Canadian Dollar (CAD) traded without a clear direction yesterday, as wavering oil prices limited the crude-linked currency’s potential.
Amid a lack of Canadian economic data today, CAD could continue to trade on oil price dynamics.
Data Releases
Sep 21st 08:45 NZD GDP (Q2) 0.5%
Sep 21st 11:30 AUD RBA Bulletin
Sep 21st 21:00 GBP BoE Interest Rate Decision 5.5%
Sep 21st 22:30 USD Initial Jobless Claims (16/Sep) 225,000
Sep 22nd 00:00 EUR ECB President Lagarde Speech