Australian dollar (AUD) uncertain despite positive Chinese PMI
The Australian dollar (AUD) was mixed yesterday, although AUD was able to eke out gains against some of its weaker rivals thanks to China’s stronger-than-expected Caixin services PMI.
A cautious market mood offset the positive Chinese data, which led to the currency’s unclear movement.
This morning’s Ai Group industry index could weigh on the ‘Aussie’ dollar, if it shows a continued contraction in Australia’s industrial sectors.
New Zealand dollar (NZD) slips as market mood sours
The New Zealand dollar (NZD) weakened yesterday as a souring market mood sapped demand for the risk-sensitive ‘kiwi’.
NZD exchange rates could face headwinds today, after New Zealand’s jobs report for the second quarter revealed a rise in unemployment.
Pound (GBP) supported by services PMI
The pound (GBP) firmed against some of its weaker peers yesterday thanks to an upward revision to the UK’s services PMI for July.
However, as the finalised survey still revealed a slowdown, and with the Bank of England’s (BoE) policy decision looming, Sterling struggled against stronger currencies.
Movement in the pound may be muted today as GBP investors await tomorrow’s interest rate decision.
Euro (EUR) slips as PMI revised lower
The euro (EUR) initially softened yesterday as the Eurozone’s final services PMI for July was revised lower.
However, the common currency recouped some losses in the evening thanks to EUR’s negative correlation with a falling US dollar (USD).
On the docket today we have German factory orders and Eurozone retail sales for July. With both sets of data expected to show a recovery last month, the euro could strengthen.
US dollar (USD) relinquishes gains following weak PMI
The US dollar initially ticked higher yesterday, with the safe-haven ‘greenback’ finally shaking off Friday’s dismal payrolls data and rising amid a risk-off market mood.
However, the ISM services PMI for July saw USD sharply reverse its gains in the evening. The survey missed forecasts to show that service sector activity slowed to a near standstill last month.
Market-moving US data is thin on the ground today, potentially leaving the safe-haven US dollar to trade on risk appetite.
Canadian dollar (CAD) subdued amid oil weakness
The Canadian dollar (CAD) traded without a clear trajectory yesterday, as falling oil prices subdued the crude-linked currency.
Looking forward, Canada’s latest services PMI could influence the ‘loonie’ today. If activity in the sector continued to contract last month, CAD could face pressure.
Data releases
08:45 NZD Unemployment Rate (Q2)
09:00 AUD Ai Group Industry Index (Jul)
16:00 EUR German Factory Orders (Jun)
19:00 EUR Retail Sales (Jun)
23:30 CAD Services PMI (Jul)