Australian dollar (AUD) fluctuates amid mixed outlook
The Australian dollar (AUD) struggled to attract investor support yesterday amid mixed data releases.
A larger-than-forecast decline in Australian consumer confidence initially dented the ‘Aussie’, though AUD’s losses were cushioned by an unexpected uptick in domestic business confidence in June.
Looking ahead, the latest Chinese inflation data is due for release later this morning. Signs of rising price pressures in China could boost AUD, due to the Australian dollar’s status as a proxy currency for the Chinese economy.
New Zealand dollar (NZD) wavers amid data lull
The risk-sensitive New Zealand dollar (NZD) traded without a clear direction yesterday amid a lack of fresh domestic releases and an unclear market sentiment.
However, NZD softened as the session progressed, with the market mood growing increasing downbeat.
The Reserve Bank of New Zealand’s (RBNZ) interest rate decision this afternoon is in focus for NZD investors. While no change to rates is expected, a hawkish outlook from the bank could boost the ‘kiwi’.
Pound (GBP) stabilises as UK election optimism fades
Amid a lack of fresh UK data, the unfolding market response to the UK’s new Labour government kept the pound (GBP) afloat on Tuesday.
However, the pound’s gains in the wake of the election began to subside, which ultimately muted the UK currency.
This evening, a speech from Bank of England (BoE) Chief Economist Huw Pill could drive GBP volatility. Could the senior policymaker strike a hawkish tone, thereby boosting the pound?
Euro (EUR) rudderless amid Frech election uncertainty
Amid an absence of macroeconomic releases in the Eurozone, concerns of political instability in France continued to limit the euro’s (EUR) movements on Tuesday.
While investors were relieved that Marine Le Pen’s far-right National Rally party had not taken the lead in the French election last weekend, uncertainty around a hung parliament prevented the common currency from climbing.
Looking ahead, a lack of fresh data in the Eurozone could see the euro encounter volatile trading conditions today.
US dollar (USD) firms following Fed commentary
The US dollar (USD) was initially subdued yesterday amid an unclear market mood and flat US Treasury yields, although bond yields began to tick higher as the session progressed, thereby lifting USD.
Overnight, commentary from Federal Reserve Chair Jerome Powell then further boosted the ‘greenback’. Powell failed to offer any concrete suggestions as to when the central bank may begin to loosen its monetary policy, while warning against cutting rates too soon.
Tonight, Powell is due to speak again. With the latest US inflation data around the corner, could any dovish signals sink the ‘greenback’?
Canadian dollar (CAD) struggles amid softer oil prices
Wavering oil prices and a lack of fresh domestic releases left the crude-linked Canadian dollar (CAD) largely subdued yesterday.
Another data-light session in Canada could therefore see the ‘loonie’ left vulnerable to any fluctuating oil prices throughout the session today.
Data Releases
10th Jul 12:00 NZD RBNZ Interest Rate Decision 5.5%
10th Jul 23:30 GBP BoE Pill Speech
11th Jul 00:00 USD Fed Chair Powell Speech