Australian dollar (AUD) fluctuates as market mood wavers
On Wednesday, the Australian dollar (AUD) wavered as a shifting market mood sparked volatility in the risk-sensitive currency.
A huge earthquake in Tawain initially soured the mood, but positive Chinese economic data and a rise in Federal Reserve interest rate cut bets eventually cheered investors, thereby lifting AUD.
Turning to today’s session, a lack of impactful macroeconomic data could see the ‘Aussie’ trade on risk appetite once again.
New Zealand dollar (NZD) choppy amid lack of data
Over Wednesday’s session, a continued absence of data drivers left the New Zealand dollar (NZD) exposed to market volatility.
While an initial downbeat mood saw NZD stumble, a gradual shift towards upbeat trade allowed the risk-sensitive ‘Kiwi’ to regain ground against its peers.
During today’s session NZD could continue trading at the behest of the market mood, as the short supply of data continues.
Pound (GBP) adrift amid light data calendar
Yesterday, the pound (GBP) traded within a narrow range against most peers, amid a lack of data releases.
This left the increasingly risk-sensitive Sterling to trade in line with market dynamics. While this allowed it to gain ground against safer rivals, it remained tepid elsewhere.
With British economic data set to remain thin on the ground, the pound may remain listless during today’s session.
Euro (EUR) firs despite cooling inflation
The euro (EUR) strengthened against many of its peers yesterday, despite Eurozone inflation cooling more than expected.
The single currency managed to shrug off the weaker inflation figures, with a notable decline in the US dollar (USD) lending EUR support due to the currencies’ strong negative correlation.
Looking ahead, the European Central Bank’s (ECB) latest meeting minutes are due to be published tonight. If they skew dovish, it may reverse yesterday’s gains and drag the euro lower.
US dollar (USD) tumbles as service sector activity slows
The US dollar fell sharply yesterday after the ISM services PMI for March printed below expectations.
Rather than showing an acceleration in activity, as expected, the data revealed that service sector growth slowed to its lowest level in three months. This pulled USD lower, despite some positive American employment data.
Tonight, the latest US initial jobless claims figure could spark further losses for the ‘greenback’. Economists expect to see an uptick in unemployment benefit claims.
Canadian dollar (CAD) flat amid mixed factors
The Canadian dollar (CAD) endured muted trade yesterday. A weaker services PMI and the declining US dollar weighed on CAD, while rising oil prices prevented losses for the crude-linked ‘loonie’.
Canada’s latest trade data is due to print tonight and is expected to show a fall in exports. This could dampen CAD.
Data releases
April 4th 18:00 EUR Services PMI (Mar) 51.1
April 4th 21:30 EUR ECB Monetary Policy Meeting Accounts
April 4th 22:30 CAD Balance of Trade (Feb) CA$0.8bn
April 4th 22:30 USD Initial Jobless Claims (30/Mar) 214,000