Australian dollar (AUD) crawls higher as markets rebound
The Australian dollar (AUD) managed to recover yesterday, having nearly refreshed multi-year lows against some of its peers, as a stock market rebound helped to lift the risk-sensitive ‘Aussie’.
The market mood improved despite escalating trade tensions between the US and China. AUD was also able to shrug off deteriorating consumer and business confidence in Australia.
Australian economic data is in short supply today. Therefore, market risk dynamics may drive most AUD movement, with any shifts potentially leading to volatility.
New Zealand dollar (NZD) climbs amid risk-positive trade
The New Zealand dollar (NZD) also rallied yesterday, with a recovery in risk appetite boosting the ‘kiwi’.
Looking ahead, the Reserve Bank of New Zealand (RBNZ) interest rate decision is in focus today. If the bank cuts rates and strikes a more dovish tone in the wake of Trump’s tariff bombshell, the New Zealand dollar could slump.
Pound (GBP) uncertain amid lack of data
The pound (GBP) lacked a clear direction yesterday amid an absence of UK economic data.
While the increasingly risk-sensitive currency rose against its safer peers, it struggled elsewhere. Dashed hopes of a UK-US trade deal continued to weigh on Sterling.
With no new UK data due out today, Sterling may continue to trade without a clear trajectory.
Euro (EUR) pressured by risk-on mood
The euro (EUR) fell against its riskier rivals yesterday as the improving mood dampened the appeal of the safer common currency.
However, EUR was spared steeper losses thanks to its negative correlation with a weaker US dollar (USD).
In the absence of notable Eurozone data today, risk sentiment could impact the safer euro. In addition, any further developments in the current EU-US trade disagreement may affect the common currency.
US dollar (USD) stumbles as markets recover
The US dollar faced selling pressure yesterday as a recovering appetite for risk deprived USD of safe-haven flows.
The improved mood came amid hints from the White House that they were seeking new trade deals with many of their trading partners.
US data remains in short supply today, likely leaving the ‘greenback’ to be influenced by risk appetite and recession fears. This may cause mixed movement in the US dollar.
Canadian dollar (CAD) wobbles in tandem with oil prices
The crude-linked Canadian dollar (CAD) was choppy yesterday as fluctuating oil prices left the ‘loonie’ without a clear direction.
Oil price movements could continue to influence the Canadian dollar today. If oil remains subdued, CAD could face pressure.
Data releases
12:00 NZD RBNZ Interest Rate Decision