Australian Dollar (AUD) Crashes as RBA Delivers Dovish Hike
Yesterday, the Australian Dollar (AUD) cratered following a dovish interest rate hike from the Reserve Bank of Australia (RBA).
While the RBA lifted rates to 4.35%, the accompanying messaging iterated a data-driven approach. This led to speculation that the bank’s tightening cycle had ended, leaving the ‘Aussie’ to fall rapidly against its peers.
This morning, the RBA is due to release its latest set of chart packs. If they indicate a downbeat outlook for the Australian economy, AUD may stumble.
New Zealand Dollar (NZD) Slips as Market Mood Degrades
The risk-sensitive New Zealand Dollar (NZD) weakened against most major peers on Tuesday, amid a souring market mood.
With a lack of data to cushion the ‘Kiwi’, NZD exchange rates fell sharply as investors looked towards safer assets.
The ‘Kiwi’ could weaken further today if the latest business inflation expectations measure cools as forecast.
Pound (GBP) Mixed amid Lack of Data
The Pound (GBP) traded without a direction of its own yesterday, due to a light data calendar.
As such, Sterling endured mixed fortunes, rising against AUD and NZD, but falling against other peers due to bearish trade.
The UK data lull is set to continue today, which may leave Sterling at the behest of the market mood.
Euro (EUR) Dented by Downbeat German Factory Data
German industrial production data printed substantially below forecasts yesterday, weakening the Euro (EUR).
Furthermore, the US Dollar (USD) moved from strength-to-strength, prompting the pairing’s negative correlation to bring further headwinds for EUR.
This evening, the latest Eurozone retail sales data is due to print, with economists anticipating a 0.2% contraction. If this prints in line with forecasts, EUR could slip.
US Dollar (USD) Soars amid Risk-Averse Impulse
Widespread risk aversion sent the US Dollar skyward over Tuesday’s trade, as investors flocked to the safe-haven currency.
Softer-than-expected Chinese trade data weighed on investor optimism, as markets grew concerned over the economic superpower’s recovery.
Tonight, Federal Reserve Chair Jerome Powell is set to deliver a speech. Hawkish remarks could strengthen the ‘Greenback’.
Canadian Dollar (CAD) Undermined by Oil Price Freefall
The crude-linked Canadian Dollar (CAD) endured mixed trade on Tuesday. Oil prices began to slump over the course of the session, overriding strong Canadian trade data.
Due to a lack of other data releases, the ‘Loonie’ may trade in tandem with oil prices today.
Data Releases
Nov 8th 12:00 NZD Business Inflation Expectations (Q4) 2.6%
Nov 8th 20:00 EUR Retail Sales (Sep) -0.2%
Nov 9th 00:15 USD Fed Chair Powell Speech