Australian dollar (AUD) boosted by upbeat market impulse
Upbeat trading conditions catapulted the Australian dollar (AUD) higher on Monday, despite a light data calendar.
Investors favoured riskier assets across the board yesterday, amid cooling tensions between Iran and Israel. Furthermore, robust iron ore and coal trade further boosted the ‘Aussie’ against its rivals.
Turning to today, the ‘Aussie’ may see volatile trade as investors analyse the morning’s flash PMI data.
New Zealand dollar (NZD) rallies amid risk-on trade
Due to upbeat trading conditions, the risk-sensitive New Zealand dollar (NZD) managed to strengthen against safer peers yesterday.
Markets cheered signs of easing tensions in the Middle East, which allowed the ‘kiwi’ to take flight. However, a lack of data may have served to limit its gains.
Data continues to remain hard to come by today, but should risk appetite remain elevated, NZD may continue to rise.
Pound (GBP) plummets amid August BoE rate cut bets
The pound (GBP) slumped yesterday, as markets began to price in an August interest rate cut from the Bank of England (BoE).
Markets now anticipate the BoE will cut rates by 50bps at their August meeting, following dovish comments from policymakers. This marks a shift from previous estimates of a September cut, which prompted GBP to slide.
This evening, the pound could recover some losses if April’s preliminary PMIs suggest economic stability as forecast.
Euro (EUR) slips amid bullish trade
Yesterday, risk-on flows pressured the euro (EUR) against its rivals.
This prompted the safer common currency to slip against its more risk-sensitive peers, with a lack of impactful data further pressuring it.
The Eurozone’s preliminary PMI data is due for publication this evening. With service sector activity expected to have ticked higher, this could allow the euro to recover some losses.
US dollar (USD) seesaws amid cheery trade
Monday saw the US dollar (USD) trade in a mixed capacity, despite a lack of market-moving data and upbeat trade.
Markets continued to price in no change to interest rates at the Federal Reserve’s meeting in June, which underpinned the safe-haven currency despite the risk-on mood.
Tonight, the preliminary US services PMI is due out. If sector activity ticked higher in April as forecast, USD may rise.
Canadian dollar (CAD) climbs despite dwindling oil prices
Despite oil prices slumping over the course of Monday’s session, the Canadian dollar (CAD) gained ground against most peers.
Data releases remain hard to come by for the ‘loonie’ today, which could place a ceiling on any gains.