Australian dollar (AUD) fluctuates in mixed trade
The Australian dollar (AUD) traded in a wide range yesterday, tracking the ups and downs in market risk appetite.
Adding to volatility was data showing that Australian consumer inflation expectations changed little this month, cementing bets that the Reserve Bank of Australia (RBA) will hike interest rates later in the year.
In the absence of any notable AUD economic indicators, the ‘Aussie’ will remain sensitive to risk sentiment today, potentially infusing further volatility into AUD.
New Zealand dollar (NZD) volatile amid uneven market mood
The New Zealand dollar (NZD) also fluctuated on Thursday amid the rapid shifts in investor sentiment.
Meanwhile, the ‘kiwi’ may catch bids this morning after New Zealand’s latest manufacturing PMI reported another acceleration in factory sector growth last month.
Pound (GBP) weakens despite positive GDP data
The pound (GBP) was pressured through yesterday’s session, despite UK GDP outpacing forecasts in November.
While a 0.3% expansion helped weaken the case for another Bank of England (BoE) interest rate cut next month, analysts warned it was unlikely to be enough to prevent growth from stalling in the last quarter of 2025.
UK economic data is in short supply today, likely leaving movement in the pound to be dictated by wider market trends.
Euro (EUR) flat on mixed German GDP print
The euro (EUR) was left rangebound on Thursday, following the publication of Germany’s latest GDP figures.
While the figures for 2025 reported the Eurozone’s largest economy returned to growth for the first time since 2022, they also saw growth in 2024 revised down from –0.2% to –0.5%.
Looking ahead, barring a surprise in Germany’s finalised inflation figures for December, the euro may struggle to find any strong directional bias today.
US dollar (USD) climbs on positive data
The US dollar (USD) enjoyed broad support yesterday as US investors cheered a surprise fall in US jobless claims last week.
Unemployment claims fell from 207,000 to 198,000, reinforcing bets the Federal Reserve may wait until June before delivering its interest rate cut.
Expect the US dollar to remain supported through today’s session if risk sentiment continues to deteriorate and US industrial production remains positive.
Canadian dollar (CAD) retreats as oil prices tumble
The Canadian dollar (CAD) faced headwinds on Thursday as a sharp drop in oil prices weakened the appeal of the commodity-linked currency.
If oil prices remain in freefall, the ‘loonie’ is likely to remain on the defensive through the remainder of the week.
Data Releases
07:30 NZD Business NZ PMI (Dec)
17:00 EUR German Inflation Rate (Dec)
00:15 USD Industrial Production (Dec)