Australian Dollar (AUD) Jumps amid Bullish Trade
Due to a risk-on impulse across markets, the Australian Dollar (AUD) rallied against most peers last Friday.
Additionally, continued momentum following Wednesday’s inflation data yielded further tailwinds. With inflation creeping higher, investors are betting on one more interest rate hike from the Reserve Bank of Australia (RBA).
With the latest monthly inflation reading due to print this morning, another uptick in price pressures could further bolster the ‘Aussie’.
New Zealand Dollar (NZD) Boosted by Renewed Consumer Optimism
Revitalised consumer confidence brought strength to the New Zealand Dollar (NZD) at the beginning of last Friday’s trade.
This was further compounded by a cheery market mood, which provided additional tailwinds for the risk-sensitive ‘Kiwi’.
Owing to a short supply of data, the ‘Kiwi’ may struggle to find a clear direction during today’s trade.
Pound (GBP) Buoyed by Upward GDP Revision
An upward revision to the UK’s second-quarter GDP reading lent some support to the Pound (GBP) early last Friday.
These gains, however, were diminished over the day’s trade amid warnings that the UK economy could still face a recession in the coming months.
This afternoon, the final UK manufacturing index reading is set to print. If it confirms a contraction in the sector, Sterling could falter.
Euro (EUR) Rebounds from CPI-Inspired Slump
The Eurozone’s latest consumer price index showed inflation at a two-year low last Friday, sending the Euro (EUR) sharply lower.
However, dip-buying brought renewed strength to the single currency, with EUR exchange rates recovering through the second part of the European session.
August’s unemployment rate is due to print this evening. If it holds at 6.4% as forecast, the common currency could rise.
US Dollar (USD) Volatile as Core Inflation Hits Two-Year Low
Last Friday, a risk-on rally in markets brought weakness to the safe-haven US Dollar (USD).
A significant cooldown in the US core PCE price index initially brought further headwinds, before the ‘Greenback’ managed to rally strongly in the US session amid an end-of-quarter market correction.
Later, the ISM is due to publish its latest manufacturing sector index. An ongoing contraction in factory activity is forecast, which may weigh on the ‘Greenback’.
Canadian Dollar (CAD) Undermined by Falling Oil
A surprise 0.1% expansion in Canada’s August GDP data briefly boosted the Canadian Dollar (CAD) last Friday, before a sharp dop in crude prices dragged the oil-linked ‘Loonie’ lower.
Tonight, the latest Canadian manufacturing PMI is due to print. September’s reading is forecast to indicate a contraction, which could weigh on the ‘Loonie’.
Data Releases
Oct 2nd 10:00 AUD TD-MI Inflation Gauge (Sep) 0.4%
Oct 2nd 18:00 EUR Manufacturing PMI Final (Sep) 43.4
Oct 2nd 18:30 GBP Manufacturing PMI Final (Sep) 44.2
Oct 2nd 19:00 EUR Unemployment Rate (Aug) 6.4%
Oct 2nd 23:30 CAD Manufacturing PMI (Sep) 47.8
Oct 3rd 00:00 USD ISM Manufacturing PMI (Sep) 47.9