Australian dollar (AUD) fluctuates amid shifting market mood
The Australian dollar (AUD) traded erratically through yesterday’s session, with the risk-sensitive currency fluctuating wildly amid sharp shifts in market sentiment.
Gains made through Thursday’s Asian trading session were initially reversed at the start of the European session, before rebounding almost as quickly in overnight trade amid hopes for peace in the Middle East.
AUD investors will look to a speech by Reserve Bank of Australia (RBA) Governor Michele Bullock for fresh impetus today. If she maintains a hawkish outlook, the ‘Aussie’ is likely to strengthen.
New Zealand dollar (NZD) gains capped by RBNZ rate cut bets
Trade in the New Zealand dollar (NZD) was mixed on Thursday as the fallout from the Reserve Bank of New Zealand’s (RBNZ) larger-than-expected rate cut on Wednesday, countered positive risk flows
Coming up, New Zealand’s latest manufacturing PMI could drag on the ‘kiwi’ this morning after reporting another contraction in factory sector activity last month.
Pound (GBP) weakened by fiscal jitters
The pound (GBP) trended lower against most of its peers yesterday, amid ongoing UK fiscal uncertainty.
Investors’ unease over the UK government’s upcoming budget continues to grow, amid concerns about how Chancellor Rachel Reeves will reconcile the government’s growth ambitions with its strained finances.
UK data remains in short supply at the end of this week, potentially leaving the pound directionless as we head into the weekend.
Euro (EUR) falters as German exports continue to fall
The euro (EUR) faced headwinds on Thursday as Germany’s latest trade data reported exports from the Eurozone’s most industrialised nation fell for a second consecutive month in August.
This offset potential gains from reports that a new French Prime Minister will be named by the end of the week, sidestepping the need for new elections in the Eurozone’s second-largest economy.
Unsurprisingly, EUR investors will be keeping a close eye on French political developments today. If the new PM is perceived as being able to restore some credibility to the French government, the euro is likely to strengthen.
US dollar (USD) firms despite positive mood
The US dollar (USD) firmed on Thursday, with the currency recovering the bulk of the losses that followed the publication of minutes from the Federal Reserve’s September policy meeting.
This rebound in USD demand came despite a broad uptick in risk appetite, amid the optimism surrounding the ‘first phase’ of the Gaza peace deal.
Closing out this week’s session is the publication of the University of Michigan’s latest US consumer sentiment index, with the US dollar likely to weaken if October’s index reports another deterioration of morale.
Canadian dollar (CAD) buoyed by BoC remarks
The Canadian dollar (CAD) ticked higher on Thursday, supported by comments from Bank of Canada (BoC) Senior Deputy Governor Carolyn Rogers, who called for more competition and fewer regulations in the banking sector to help boost Canada’s economy.
Canada’s latest jobs report will be in the spotlight today. Expect to see the ‘loonie’ falter if today’s data reveals the labour market continued to cool in September.
Data Releases
07:30 NZD Business NZ PMI (Sep)
08:00 AUD RBA Bullock Speech
22:30 CAD Unemployment Rate (Sep)
00:00 USD Consumer Sentiment (Oct)