Australian Dollar (AUD) slumps amid souring mood
The Australian Dollar (AUD) initially firmed yesterday, with the currency drawing support from a stronger-than-expected services PMI from China.
However, the ‘Aussie’ then relinquished these gains overnight as a souring market mood saw this support evaporate.
Movement in the Australian Dollar is likely to remain tied to market risk appetite today. Potentially leading AUD exchange rates to weaken if the mood remains downbeat.
New Zealand Dollar (NZD) fluctuates amid mixed market mood
Trade in the New Zealand Dollar (NZD) mirrored that of the ‘Aussie’ on Tuesday, with the ‘Kiwi’ ultimately ending the session lower amid a gloomy mood.
Will persistent risk-off flows extend the New Zealand Dollar’s losses today?
Pound (GBP) buoyed by better-than-expected services PMI
The Pound (GBP) firmed during yesterday’s session, after the UK’s latest services PMI beat expectations.
A larger-than-expected expansion in the vital services sector in December’s finalised PMI reading was welcomed by GBP investors as it bolsters hopes the UK could still avoid slipping into a recession.
Looking ahead, with UK data thin on the ground today, the Pound may trade without any strong directional bias.
Euro (EUR) strengthens as German inflation jumps
The Euro (EUR) rallied on Thursday, in response to Germany’s latest consumer price index.
December’s preliminary CPI figures reported German inflation accelerated from 3.2% to 3.7%. This was the first rise in inflation in seven months and lifted the Euro as it dispelled European Central Bank (ECB) interest rate cut expectations.
If this spike in inflation is mirrored in the Eurozone CPI figures later today, it’s likely the Euro could extend its gains.
US Dollar (USD) undermined by FOMC minutes
The US Dollar (USD) trended broadly lower yesterday, as the minutes from the Federal Reserve’s latest policy meeting showed that some officials are concerned that ‘overly restrictive’ monetary policy could stifle US economic growth.
However, the ‘Greenback’ managed to claw back some of these losses later in the US trading session after the latest US jobs data beat expectations.
Centre stage today will be the latest US non farm payroll report. Will another lacklustre increase in employment growth sink the US Dollar? Or will December’s figures surprise to the upside and boost USD sentiment?
Canadian Dollar (CAD) steady amid modest uptick in oil prices
The Canadian Dollar (CAD) traded sideways on Thursday as a modest uptick in oil prices only offered limited support to the commodity-driven currency.
Coming up, Canada will publish its latest jobs report later this evening. Will a rise in unemployment last month pull the ‘Loonie’ lower?
Data Releases
Jan 5th 17:00 EUR German Retail Sales (Nov) -0.1%
Jan 5th 20:00 EUR Inflation Rate (Dec) 3%
Jan 5th 23:30 CAD Unemployment Rate (Dec) 5.9%
Jan 5th 23:30 USD Non Farm Payrolls (Dec) 170,000