Australian dollar (AUD) wobbles amid mixed data
The Australian dollar (AUD) initially weakened yesterday, despite positive consumer confidence data, as a risk-off mood and an unexpected decline in Australian business confidence put pressure on AUD.
However, the ‘Aussie’ was able to regain ground against some of its peers in the evening as risk appetite improved.
With no market-moving Australian data due for publication today, the ‘Aussie’ may trade on global risk sentiment.
New Zealand dollar (NZD) rebounds amid return in risk appetite
The New Zealand dollar (NZD) also initially stumbled yesterday before recovering as market conditions brightened in the evening.
New Zealand data is absent from the calendar today. Therefore, market risk appetite may be the driving factor behind NZD movement.
Pound (GBP) drops as jobs data fuels BoE rate cut bets
The pound (GBP) fell yesterday after a weaker UK jobs report fuelled bets on an interest rate cut from the Bank of England (BoE) next month.
The latest data showed unemployment leapt to a four-year high of 5% in the three months to September, while wage growth eased, increasing the likelihood that the BoE will lower rates in December.
BoE Chief Economist Huw Pill is due to deliver a speech today. If he sounds less hawkish following the latest jobs data, rate cut bets could undermine GBP once again.
Euro (EUR) firms despite disappointing German data
The euro (EUR) found some success yesterday, with the single currency shrugging off a surprise deterioration in German economic sentiment in November.
EUR’s upside came courtesy of its negative correlation with a declining US dollar (USD). The euro also benefitted from expectations that the European Central Bank (ECB) is done lowering interest rates, while many of its global counterparts will likely continue cutting.
Turning to today, softer factory gate inflation in Germany could weigh on the euro, if it’s seen as an indication that inflation could be easing across the Eurozone as a whole.
US dollar (USD) declines amid dovish Fed bets
The US dollar fell yesterday as growing bets on a Federal Reserve rate cut next month dragged on the American currency.
The new weekly ADP employment data showed that in the four weeks to 25 October, private employers cut an average of 11,250 jobs per week. This sign of a weakening labour market boosted Fed rate cut bets.
Looking ahead to today’s session, a number of Federal Reserve policymakers are due to deliver speeches. Could a broadly dovish consensus drag the US dollar lower?
Canadian dollar (CAD) mixed as oil rises and USD falls
The crude-linked Canadian dollar (CAD) was mixed yesterday as the upside from rising oil prices was offset by CAD’s positive correlation with USD.
Notable Canadian data remains absent from the calendar today, potentially leaving the ‘loonie’ to trade on oil price dynamics.
Data releases
17:00 EUR German Wholesale Prices (Oct)
20:45 EUR ECB Schnabel Speech
21:40 EUR ECB Guindos Speech
22:05 GBP BoE Pill Speech