Australian dollar (AUD) muted amid mixed mood
The Australian dollar (AUD) traded in a narrow range yesterday amid a lack of data and a muted market mood.
Although markets were relieved that trade tensions between the US and China have not escalated since Donald Trump took office, a note of caution remained.
Earlier this morning, Australia’s latest PMI surveys showed that business activity remains sluggish this month. This could pressure AUD through today’s session.
New Zealand dollar (NZD) flat amid tepid risk appetite
The New Zealand dollar (NZD) was similarly subdued yesterday amid the cautious optimism around US-China trade relations.
New Zealand data is thin on the ground today. As a result, risk appetite could drive most movement in the risk-sensitive ‘kiwi’.
Pound (GBP) uncertain as investors ignore CBI data
The pound (GBP) traded mostly sideways yesterday as a lack of notable UK economic data left Sterling without a clear directional bias.
GBP investors shrugged off some gloomy data from the Confederation of British Industry (CBI), instead preferring to wait for the more impactful data due out today.
That data is the UK’s latest PMIs. If British private sector activity ground to a halt this month, as expected, then Sterling could slide.
Euro (EUR) softens amid risk-positive mood
The euro (EUR) came under some pressure yesterday as a cautiously optimistic market mood dampened demand for the safer single currency.
In addition, ongoing European Central Bank (ECB) interest rate cut bets and weak Eurozone consumer confidence also dented EUR sentiment.
The Eurozone’s preliminary PMIs are also due out today. Another contraction in business activity in the bloc could hammer the euro.
US dollar (USD) stabilises as Trump volatility subsides
The US dollar (USD) was relatively calm yesterday as the volatility following Trump’s inauguration at the start of the week continued to subside.
USD investors were seemingly waiting to see if the new US President would unveil any new measures, particularly around tariffs or fiscal policy.
Overnight, the latest US PMIs from S&P Global will be published. While these aren’t as impactful as the ISM PMI surveys, they could still support USD if they show a robust expansion in service sector activity.
Canadian dollar (CAD) struggles despite positive sales data
The crude-linked Canadian dollar (CAD) failed to gain ground yesterday, despite rising oil prices and stronger-than-expected retail sales figures, as concerns over tariffs hung over the currency.
CAD ends the week amid a lack of market-moving Canadian data. As a result, oil price movements may drive the ‘loonie’.
Data releases
08:00 AUD Composite PMI (Jan)
19:00 EUR Composite PMI (Jan)
19:30 GBP Composite PMI (Jan)
20:00 EUR ECB President Lagarde Speech
00:45 USD Composite PMI (Jan)