Australian Dollar (AUD) slides in cautious trade
The Australian Dollar (AUD) stumbled during yesterday’s trading session as a cautious mood limited demand for the risk-sensitive currency.
This caution came ahead of some high-impact US data, which could provide clues as to how quickly the Federal Reserve will cut US interest rates this year.
Looking ahead, AUD investors are likely to keep a close eye on China’s latest services PMI. If December’s index underperforms the ‘Aussie’ could face some resistance.
New Zealand Dollar (NZD) knocked by risk-off mood
The New Zealand Dollar (NZD) also trended broadly lower on Tuesday, after its initial gains were reversed as market sentiment soured
In the absence of any notable domestic data, expect movement in the ‘Kiwi’ to remain tied to market risk dynamics today.
Pound (GBP) buoyed by consumer spending hopes
The Pound (GBP) ticked higher during yesterday’s session amid hopes that strong consumer spending over the holiday period may have helped the UK avoid a recession in 2023.
Data suggests that UK supermarkets enjoyed their busiest Christmas period since 2019, despite many consumers still being pressured by high interest rates and elevated inflation.
Coming up, Sterling sentiment may continue to improve today, if the UK’s latest services PMI confirms the private sector growth climbed to a six-month high in December.
Euro (EUR) Muted on mixed German jobs data
The Euro (EUR) struggled to find momentum on Wednesday, following the publication of Germany’s latest jobs report.
December’s figures reported unemployment in the Eurozone’s largest economy climbed to 5.9%, its highest level since May 2021. However, the rise in unemployed individuals was smaller-than-expected.
Germany will publish its latest consumer price index later this evening. December’s CPI figures are expected to report a sharp acceleration in inflation. Will this weaken European Central Bank (ECB) interest rate expectations and boost the Euro?
US Dollar (USD) muted ahead of Fed minutes
The US Dollar (USD) traded sideways yesterday as USD investors awaited the publication of the minutes from the Federal Reserve’s latest policy meeting.
Also infusing some volatility into USD exchange rates in was some mixed US data. While the latest US manufacturing PMI beat forecasts in December, job openings dropped to a 31-month low.
The publication of the latest ADP employment figures may influence USD exchange rates later today. Will another lackluster expansion in US employment growth trigger a slump in the ‘Greenback’?
Canadian Dollar (CAD) dips despite uptick in oil prices
The Canadian Dollar (CAD) edged lower on Wednesday, with the oil sensitive struggling to attract support, despite a continued uptick in crude prices.
If oil prices remain on a positive trajectory will the ‘Loonie’ be able to mount a comeback today?
Data Releases
Jan 4th 19:00 EUR Services PMI (Dec) 48.1
Jan 4th 19:30 GBP Services PMI (Dec) 52.7
Jan 4th 23:00 EUR German Inflation Rate (Dec) 3.7%
Jan 4th 23:15 USD ADP Employment Change (Dec) 115,000