Australian dollar (AUD) slips as exports slump
The Australian dollar (AUD) weakened yesterday as some dire trade data undermined the ‘Aussie’.
Australian exports plunged 2.7% in May, reducing the country’s trade surplus by more than half.
AUD ends the week with little in the way of economic data. As a result, market risk dynamics could drive the Australian dollar.
New Zealand dollar (NZD) dented by risk-off mood
The New Zealand dollar (NZD) also lost ground during Thursday’s session, with a gloomy market mood dampening demand for the risk-sensitive ‘kiwi’.
Market sentiment may continue driving NZD today as data releases from New Zealand are absent from the calendar.
Pound (GBP) regains ground as Starmer backs Chancellor
The pound (GBP) recouped some of Wednesday’s losses yesterday after Prime Minister Keir Starmer publicly backed Chancellor Rachel Reeves, quashing rumours she might be replaced.
A stronger-than-expected final services PMI also supported the pound, although GBP’s recovery was limited.
Sterling may find its movement muted today, as the week comes to a close with no notable UK data on the docket.
Euro (EUR) undermined by USD correlation
The euro (EUR) trended lower yesterday, as EUR suffered from its negative correlation with a strengthening US dollar (USD).
The Eurozone’s final services PMI failed to provide the single currency with much support. Although it was revised slightly higher, activity remained at a near standstill last month.
With German factory orders and Eurozone PPI both forecast to decline today, EUR could come under pressure. However, any hawkish comments from European Central Bank (ECB) President Christine Lagarde could aid the common currency.
US dollar (USD) jumps as payrolls beat forecasts
The US dollar strengthened yesterday thanks to forecast-beating US jobs data.
Non-farm payrolls printed at 147,000 in June, up from 144,000 in May and above forecasts of 110,000. In addition, the US unemployment rate unexpectedly edged down and the ISM services PMI also came in higher than anticipated.
US markets are closed today for Independence Day, which could mean USD movement is subdued.
Canadian dollar (CAD) buoyed by stronger US dollar
The Canadian dollar (CAD) enjoyed some support yesterday thanks to its positive correlation with the US dollar, although weakening oil prices limited the crude-linked currency’s gains.
Turning to today, Canada’s June services PMI could impact CAD. If the sector remained in contraction last month, the ‘loonie’ may struggle to find support.
Data releases
16:00 EUR German Factory Orders (May)
17:30 EUR ECB President Lagarde Speech
19:00 EUR PPI (May)
23:30 CAD Services PMI (Jun)