Australian Dollar (AUD) slumps as market mood sours
A larger-than-forecast rise in Australian inflation initially lifted the Australian Dollar (AUD) yesterday.
However, a souring market mood saw the risk-sensitive currency quickly reverse direction and plunge against most of its peers.
Turning to this morning, could an expected rise in Australian consumer confidence lend AUD some support?
New Zealand Dollar (NZD) hits one-month lows amid risk-off mood
The New Zealand Dollar (NZD) fell sharply yesterday, hitting monthly lows against many of its rivals.
The downside came as a bearish market mood weighed heavily on the risk-sensitive ‘Kiwi’.
New Zealand economic data is absent from the calendar today, meaning NZD may once again trade on market risk dynamics.
Pound (GBP) mixed amid lack of data
The Pound (GBP) was mixed yesterday amid a lack of UK economic data.
The thin trading conditions saw Sterling fall against its safer peers and rise against its riskier rivals.
Looking ahead, the Pound could face heavy selling pressure this evening, if a cooldown in UK wage growth boosts bets on an interest rate cut from the Bank of England (BoE).
Euro (EUR) capped by contracting German economy
The Euro (EUR) firmed against many of its peers yesterday as investors favoured the safer currency amid the downbeat market mood.
However, weak data limited EUR’s upside. German GDP was shown to have contracted in 2023, while Eurozone industrial production shrank in November.
Tonight, an expected decline in German economic sentiment could dent EUR. However, if it beats forecasts, as it did the previous month, then the Euro could climb.
US Dollar (USD) rises amid risk aversion
The US Dollar (USD) gained ground yesterday as risk-averse trade boosted the safe-haven currency’s appeal.
A fresh escalation in the Middle East sparked anxiety among investors, after a missile fired from Yemen hit a US-owned container ship in the Gulf of Aden.
Market-moving US economic data is in short supply today. USD may therefore trade on risk appetite once again.
Canadian Dollar (CAD) slips as oil prices decline
The crude-linked Canadian Dollar (CAD) weakened yesterday as falling oil prices dragged the currency down.
Canada’s latest consumer price index could drive CAD movement tonight. Will an uptick in inflation see the ‘Loonie’ gain ground?
Data Releases
Jan 16th 09:30 AUD Westpac Consumer Confidence Index (Jan) 82.5
Jan 16th 17:00 GBP Unemployment rate (Nov) 4.2%
Jan 16th 17:00 GBP Average Earnings (Nov) 6.6%
Jan 16th 20:00 EUR DE ZEW Economic Sentiment Index 12
Jan 16th 23:30 CAD Inflation Rate (Dec) 3.3%