Australian dollar (AUD) slumps as retail sales decline
The Australian dollar (AUD) snapped its recent winning streak yesterday, plunging against most of its rivals, following an unexpected 0.4% contraction in Australian retail sales.
In addition, a souring market mood pressured the risk-sensitive ‘Aussie’ as hopes of a ceasefire in the Middle East started to fade.
This morning, the latest Australian industry index could impact AUD. Could another improvement lift the ‘Aussie’?
New Zealand dollar (NZD) plummets as business confidence collapses
The New Zealand dollar (NZD) also faced selling pressure on Tuesday after domestic business confidence tumbled to its lowest level since September 2023.
The bearish market mood also weighed on the risk-sensitive ‘kiwi’.
This morning, NZD could see volatility as markets continue to respond to the latest New Zealand labour market report.
Pound (GBP) mixed as risk sentiment drives movement
The pound (GBP) moved without a clear trajectory yesterday as a lack of UK economic data left GBP exposed to market risk appetite.
This saw the increasingly risk-sensitive currency weaken against its safer peers while rising against its riskier rivals.
Looking ahead, the only UK data due out today is the finalised manufacturing PMI. Confirmation of a contraction in British factory activity could apply some pressure to the pound.
Euro (EUR) climbs as GDP and CPI beat forecasts
The euro (EUR) strengthened during yesterday’s European session after Eurozone GDP beat forecasts to show a promising return to growth in the first quarter of 2024.
In addition, the Eurozone consumer price index was slightly hotter than expected. Headline inflation held steady at 2.4% while core inflation eased from 2.9% to 2.7%, above forecasts of 2.6%. These releases saw markets bet on a less aggressive pace of policy loosening from the European Central Bank (ECB).
Eurozone economic data is thin on the ground today. As a result, the euro could struggle to find a clear direction.
US dollar (USD) climbs amid anxious market mood
The US dollar (USD) gained ground yesterday as a decline in risk appetite boosted the safe-haven currency’s appeal.
Recent optimism around peace negotiations in the Middle East faded after Israeli Prime Minister Benjamin Netanyahu said he would press ahead with his controversial assault on Rafah, ‘with or without a [ceasefire] deal’.
Turning to today, the US dollar could be subdued as investors may hold back from placing any aggressive bets ahead of the Federal Reserve interest rate decision tomorrow morning.
Canadian dollar (CAD) plunges on weak GDP and falling oil
The Canadian dollar (CAD) faced heavy losses yesterday after Canada’s latest GDP figures missed forecasts. A slump in oil prices added to the crude-linked currency’s losses.
Tonight, Bank of Canada (BoC) Governor Tiff Macklem is due to deliver a speech. Could dovish comments dent the Canadian dollar?