Australian dollar (AUD) wavers following mixed data
The Australian dollar (AUD) fluctuated yesterday in response to mixed domestic data, with the Ai Group industry index beating forecasts but Australia’s final services PMI printing below preliminary estimates.
The risk-sensitive currency then faced headwinds in the evening as a cautious mood gripped markets.
Turning to today, Australia’s latest trade figures are the focus. Could a widening trade surplus lend AUD support?
New Zealand dollar (NZD) dented by rising unemployment
The New Zealand dollar (NZD) initially fell yesterday after new data showed domestic unemployment rose to 5.3% in the third quarter.
NZD then tried to recover, but market volatility ultimately saw the ‘kiwi’ waver.
Looking ahead, data from New Zealand is absent from the calendar today. As a result, global risk dynamics could drive NZD exchange rates.
Pound (GBP) bolstered by stronger PMI
The pound (GBP) managed to stage a modest recovery during yesterday’s European session, thanks to an upwardly revised UK services PMI showing growing activity in October.
However, ongoing concerns about the upcoming autumn budget and hesitancy ahead of today’s Bank of England (BoE) decision kept a lid on the UK currency.
Today, GBP investors are laser-focused on the BoE decision. If the bank holds interest rates but strikes a dovish tone, Sterling could slip. A surprise rate cut would likely lead to steeper losses.
Euro (EUR) unclear despite upbeat data
The euro (EUR) traded without a clear direction yesterday, as positive economic data and geopolitical fears pulled the currency in opposing directions.
Although German factory orders rebounded in September and the Eurozone’s final services PMI was revised higher, news of drones disrupting civil airports and military bases in Belgium unnerved EUR investors, amid suspicion of Russian involvement.
More positive German data today could potentially give the single currency a lift. If industrial production in the Eurozone’s largest economy rebounded in September, as expected, the euro could climb.
US dollar (USD) stays strong as data beats forecasts
The US dollar (USD) initially held steady yesterday, wavering against most peers near multi-month highs, as an uncertain mood gripped markets.
In the evening, stronger-than-expected results in the latest ADP employment change report and ISM services PMI lent USD support.
US economic data is absent from the calendar today, likely leaving the American dollar to trade on market risk appetite. Could a gloomy mood lend USD safe-haven support?
Canadian dollar (CAD) slips following federal budget
The Canadian dollar (CAD) softened yesterday as the unveiling of Canada’s federal budget failed to inspire CAD investors.
Canada’s Ivey PMI for October is due out overnight. An expected slowdown in activity could pressure the ‘loonie’.
Data releases
10:30 AUD Balance of Trade (Sep)
17:00 EUR German Industrial Production (Sep)
20:00 EUR Retail Sales (Sep)
22:00 GBP BoE Interest Rate Decision
01:00 CAD Ivey PMI (Oct)