Australian dollar (AUD) slides on global growth concerns
The Australian dollar (AUD) stumbled through the start of this week’s session, with the currency running afoul of a risk-averse market mood.
Risk sentiment faltered after Japan and Switzerland reported third-quarter GDP contractions, raising broader concerns about global growth.
The minutes from the Reserve Bank of Australia’s (RBA) latest policy meeting could help to revive AUD demand today, if they reaffirm the RBA’s recent hawkish messaging.
New Zealand dollar (NZD) pressured by cautious mood
The New Zealand dollar (NZD) was also pressured by the downbeat mood on Monday, although these losses were tempered by the news that the US was removing additional tariffs on a range of New Zealand agricultural exports.
In the absence of any notable domestic data, movement in the ‘Kiwi’ is likely to remain tied to market risk dynamics today, with NZD exchange rates at risk of further losses if sentiment continues to deteriorate.
Pound (GBP) recovery tempered by budget anxiety
The pound (GBP) trended broadly higher through yesterday’s session, clawing back some of its losses from the end of last week.
However, Sterling’s gains remained limited in scope, amid ongoing concerns over the contents of Chancellor Rachel Reeves’s upcoming budget.
GBP investors will look to a speech by Bank of England (BoE) policymaker Swati Dhingra for fresh impetus on Tuesday. As one of the bank’s most dovish members, her remarks could weigh on Sterling if she touches on policy.
Euro (EUR) fails to draw support from revised growth forecast
The euro (EUR) struggled to attract support on Monday as the single currency’s negative correlation with the US Dollar (USD) overshadowed upwardly revised Eurozone growth forecasts from the European Commission.
The EC raised its 2025 growth forecast from 0.9% to 1.3%, but attributed the upgrade to a temporary uptick in demand, as exports jumped in anticipation of US tariffs.
Notable Eurozone data is in short supply today, which could leave the euro to trade without direction today.
US dollar (USD) firms on hawkish Fed bets
The US dollar got off to a positive start this week amid a further trimming of Federal Reserve interest rate expectations, with the odds of a December rate cut falling to just 44%.
Reinforcing the upside in USD was the risk-averse market mood, which bolstered demand for safe-haven assets like the ‘Greenback’.
Coming up, the latest ADP employment figures could temper USD demand today, if data for the last week of October points to another slowdown in the US labour market.
Canadian dollar (CAD) dips as inflation cools
The Canadian dollar (CAD) traded with modest losses on Monday as bets for another Bank of Canada (BoC) rate cut ticked higher, following a cooling of domestic inflation.
Oil price dynamics will likely drive movement in the ‘loonie’ today, with CAD exchange rates likely to falter if oil prices continue to weaken.
Data Releases
10:30 AUD RBA Minutes
23:15 USD ADP Employment Change (1/Nov)
01:00 USD Factory Orders (Aug)
02:00 GBP BoE Dhingra Speech