Australian Dollar (AUD) Recovers as Bullish Impulse Grows
The risk-sensitive Australian Dollar (AUD) enjoyed a strong recovery last night as the market mood brightened.
While deteriorating Australian business and consumer confidence initially weighed on AUD, cooler-than-expected US inflation data in the evening prompted cheery trade. As such, the ‘Aussie’ was able to leap against safer assets.
Today, the ‘Aussie’ could see variable trade due to a short supply of data. If the risk-on mood persists, AUD could hold strong.
New Zealand Dollar (NZD) Rises as Markets Brighten
Yesterday, the New Zealand Dollar (NZD) soared against most peers over the course of the session, amid bullish trade.
As an acutely risk-sensitive currency, the ‘Kiwi’ was able to gather pace, shrugging off a sharp cooldown in food inflation.
Due to a lull in macroeconomic releases, the ‘Kiwi’ may trade without a clear direction today.
Pound (GBP) Underpinned by Better-than-Forecast Labour Data
Robust pay data and steady unemployment initially kept the Pound (GBP) afloat at the beginning of yesterday’s European session.
Sterling then joined other risky assets in rocketing overnight, as risk appetite improved significantly.
This afternoon, Sterling may struggle to attract support if inflation cools in line with forecasts.
Euro (EUR) Boosted by Improving German Outlook
On Tuesday, the Euro (EUR) strengthened against some of its peers as the German ZEW economic sentiment index for November beat forecasts.
The reading printed at 9.3, versus the expected score of 5, marking the fifth consecutive improvement and returning to positive territory for the first time since April.
Later this evening, a 1% contraction in Eurozone industrial production could trim EUR’s gains.
US Dollar (USD) Crashes as Inflation Cools More than Forecast
After a slow start to Tuesday’s session, the US Dollar (USD) cratered during American trading hours following a cooler-than-expected consumer price index.
October’s headline and core inflation rates both printed below estimates, leading to a sharp selloff in the ‘Greenback’ as markets scaled back bets on another Federal Reserve interest rate hike.
Tonight, US retail sales data for October is due to print, with economists expecting a 0.3% contraction. Signs of slowing consumer spending could weigh heavily on USD.
Canadian Dollar (CAD) Unwound by Falling USD
Despite a sharp uptick in oil prices, the Canadian Dollar (CAD) slid alongside USD yesterday due to their close correlation.
Due to a quiet data calendar today, oil prices may be CAD’s primary driver of movement.
Data Releases
Nov 15th 17:00 GBP Inflation Rate (Oct) 4.8 %
Nov 15th 20:00 EUR Industrial Production (Sep) -1%
Nov 15th 23:30 USD Retail sales (Oct) -0.3%