Australian dollar (AUD) buoyed by China hopes
The Australian dollar (AUD) strengthened yesterday as Chinese President Xi Jinping met with business leaders in an indication that the government was looking to work more closely with the private sector.
As the ‘Aussie’ often trades as a proxy for the Chinese economy, hopes of cross-sector collaboration on growth boosted AUD.
However, the ‘Aussie’ dollar could relinquish those gains today as the Reserve Bank of Australia (RBA) is expected to cut interest rates for the first time since 2020.
New Zealand dollar (NZD) rangebound as RBNZ decision looms
The New Zealand dollar (NZD) moved sideways yesterday amid a quiet day of trade and ahead of the Reserve Bank of New Zealand (RBNZ) interest rate decision on Wednesday.
NZD may remain muted today, with investors potentially hesitant ahead of tomorrow’s expected rate cut from the RBNZ.
Pound (GBP) quiet ahead of high-impact data
The pound (GBP) was muted yesterday as markets awaited high-impact British data later in the week.
Today’s jobs report and tomorrow’s consumer price index could upend Bank of England (BoE) interest rate cut expectations, so GBP investors were hesitant to place aggressive bets yesterday.
Markets expect to see accelerating wage growth in today’s labour market data. If so, Sterling could climb.
Euro (EUR) dented by dovish ECB comments
The euro (EUR) faced a tough start to the week following some dovish comments from European Central Bank (ECB) policymaker Fabio Panetta over the weekend.
Panetta said he was worried the bank would undershoot its 2% inflation target, as he expects US tariffs to have a ‘limited, if not slightly negative’ impact on Eurozone inflation.
Germany’s ZEW economic sentiment index is out this evening. Could an improved score this month see the euro gain ground?
US dollar (USD) quiet amid market closure
The US dollar (USD) was quiet yesterday as American markets closed for the Presidents’ Day federal holiday.
This left the ‘greenback’ to waver in a narrow range for much of the session.
Economic data from America is in short supply today. Therefore, risk appetite or any comments from Donald Trump could drive most USD movement.
Canadian dollar (CAD) wobbles despite rising oil prices
The crude-linked Canadian dollar (CAD) was mixed yesterday, with an uptick in oil prices failing to prevent CAD from slipping against its stronger peers.
Tonight, the focus is on Canada’s latest CPI figures. If inflation remains below the Bank of Canada’s (BoC) 2% target then the Canadian dollar could decline amid growing rate cut bets.
Data releases
13:30 AUD RBA Interest Rate Decision
17:00 GBP Unemployment Rate (Dec)
17:00 GBP Average Earnings (Dec)
19:30 GBP BoE Gov Bailey Speech
20:00 EUR German ZEW Economic Sentiment Index (Feb)
23:30 CAD Inflation Rate (Jan)