Australian dollar (AUD) slides following inflation figures
The Australian dollar (AUD) slipped to fresh multi-month lows against some of its rivals yesterday following Australia’s latest inflation figures.
Domestic inflation cooled rapidly in the third quarter, from 3.8% to 2.8% – its lowest level since the first quarter of 2021. This fuelled bets on possible interest rate cuts from the Reserve Bank of Australia (RBA).
Turning to today, Australia’s latest retail sales figures are out this morning. A slowdown in sales growth last month could weigh on AUD.
New Zealand dollar (NZD) bounces off multi-month lows
The New Zealand dollar (NZD) also dropped to multi-month lows yesterday, thanks to NZD’s strong positive correlation with AUD.
However, the ‘kiwi’ managed to rebound as European trade began thanks to a drop in the US dollar (USD).
New Zealand business confidence is the focus for NZD investors today. Could a drop in confidence dent the New Zealand dollar?
Pound (GBP) volatile as UK unveils budget
The pound (GBP) was choppy yesterday as investors reacted to the unveiling of the UK’s Autumn Budget.
While £40bn in tax hikes put some pressure on the pound, upward revisions to UK GDP and inflation forecasts lent Sterling support.
The budget could have a lingering impact on the pound today due to a lack of market-moving UK data.
Euro (EUR) rallies as GDP beats forecasts
The euro (EUR) strengthened during yesterday’s European session as stronger-than-forecast Eurozone GDP boosted the single currency.
Economic growth in the bloc unexpectedly accelerated from 0.2% to 0.4% in the third quarter. This positive data saw the euro leap higher.
Looking ahead, the Eurozone’s latest consumer price index could boost EUR tonight. Analysts expect to see an uptick in inflation in October.
US dollar (USD) whipsaws amid mixed data
The US dollar was volatile yesterday as mixed US economic data saw the American currency fluctuate, with the ‘greenback’ eventually trending lower.
Stronger-than-forecast ADP payrolls figures initially boosted USD before an unexpected slowdown in US third-quarter GDP brought the US dollar back down.
The latest core PCE price index – the Federal Reserve’s preferred measure of inflation – is out tonight. If inflation cools as expected, USD could stumble.
Canadian dollar (CAD) wavers lower on USD correlation
The Canadian dollar (CAD) was rocked by its positive correlation with the US dollar yesterday. Strong oil prices cushioned the crude-linked currency, however.
Tonight, Canada’s latest GDP figures could drive most movement. Could a recovery in growth in September see the Canadian dollar rise?
Data releases
10:00 NZD ANZ Business Confidence (Oct)
10:30 AUD Retail Sales (Sep)
20:00 EUR Inflation Rate (Oct)
22:30 CAD GDP (Sep)
22:30 USD Core PCE Price Index (Sep)