Australian dollar (AUD) mixed as unemployment rises
Trade in the Australian dollar (AUD) was uneven on Thursday, as markets digested Australia’s latest employment figures.
February’s figures made for mixed reading, with unemployment rising despite a surprisingly large jump in employment growth, which saw total employment reach a new record high.
In the absence of notable AUD economic indicators, AUD exchange rates will likely be influenced by market risk dynamics today, leaving the ‘Aussie’ exposed if risk appetite sours.
New Zealand dollar (NZD) shrugs off GDP miss
The New Zealand dollar (NZD) trended broadly higher yesterday, seemingly unfazed by weaker-than-expected domestic growth in the last quarter of 2025.
Expect the ‘kiwi’ also to be driven by market risk sentiment today amid a lull in domestic data.
Pound (GBP) strengthens following BoE rate decision
The pound (GBP) jumped on Thursday after the Bank of England (BoE) voted unanimously to keep interest rates on hold, as it warned of the inflationary shock posed by the war in Iran.
GBP investors then seized on the bank’s comments suggesting it ‘stands ready to act’ to keep inflation under control, raising bets the BoE could now deliver two rate hikes in 2026, despite BoE Governor Bailey warning markets against reaching ‘any strong conclusions’.
The Confederation of British Industry (CBI) will publish its latest industrial orders data today, with the pound potentially weakening if we see a fresh decline in the UK’s total order book balance this month.
Euro (EUR) rises as ECB raises inflation forecast
The euro (EUR) also firmed yesterday, with the delivery of the European Central Bank’s (ECB) own interest rate decision.
The ECB also kept rates on hold this month and warned about the risks posed by the war in Iran, while raising its average inflation forecast for 2026 to 2.6%.
The publication of Germany’s producer price index may lift the euro today, if it reports that factory input inflation began to tick up in February, even before the energy price crisis.
US dollar (USD) rocked by Middle East uncertainty
Trade in the US dollar (USD) was choppy on Thursday, amid rising tensions in the Middle East and concerns that US control over the situation is slipping.
This overshadowed a surprise fall in US jobless claims last week, which may have otherwise strengthened the ‘greenback’.
US economic releases are in short supply today, likely leaving movement in the US dollar to be dictated by wider market trends through the remainder of the week.
Canadian dollar (CAD) slips despite rising oil prices
The Canadian dollar (CAD) found itself on the defensive yesterday, seemingly unable to benefit from its usual positive correlation with oil prices, which climbed above $110 a barrel.
Closing out this week’s session is the publication of Canada’s latest retail sales figures. Sales growth is expected to have contracted in February, potentially piling pressure on the ‘loonie’.
Data releases
17:00 EUR German PPI (Feb)
21:00 GBP CBI Industrial Trends Orders (Mar)
22:30 CAD Retail Sales (Feb)