Australian dollar (AUD) hit by profit-taking and risk-off mood
The Australian dollar (AUD) fell sharply on Friday, with the ‘Aussie’ falling afoul of some profit-taking and a deterioration in market risk appetite.
This saw AUD relinquish a large portion of the gains it made through the week, and saw it end the session lower against its stronger peers.
With Australian data thin on the ground today, market risk appetite could remain the key catalyst for AUD movement.
New Zealand dollar (NZD) slumps amid risk aversion
The New Zealand dollar (NZD) also took a tumble at the end of last week’s session, as a deeply downbeat market mood weighed heavily on the risk-sensitive currency.
Turning to today, the ‘kiwi’ could face pressure after April’s services PMI revealed another contraction in activity.
Pound (GBP) languishes as political uncertainty continues
The pound (GBP) remained subdued on Friday, with Sterling licking its wounds after a bruising week for the UK currency.
Political uncertainty continued to weigh on GBP exchange rates, amid signs that Greater Manchester Mayor Andy Burnham could return to parliament to challenge Prime Minister Keir Starmer.
Speeches from two Bank of England (BoE) policymakers could impact GBP today, although investors may focus on political headlines. Ongoing uncertainty over Starmer’s future could see Sterling struggle.
Euro (EUR) unsure in absence of data
The euro (EUR) was mixed on Friday as a lack of Eurozone data left the single currency rudderless.
While the safer euro held its ground against riskier rivals, EUR struggled against its stronger peers.
Eurozone economic data is in short supply at the start of this week’s session, potentially leaving EUR without a clear directional bias once again.
US dollar (USD) consolidates gains after strong week
The US dollar (USD) extended its winning streak on Friday, as ongoing risk aversion underpinned the safe-haven ’greenback’.
Interest rate expectations also supported the American currency, with markets increasingly betting on a Federal Reserve rate hike to tame rising inflation.
Risk appetite could drive USD movement today, with the ‘greenback’ poised to strengthen if a gloomy mood prevails.
Canadian dollar (CAD) buoyed by strong oil prices
The crude-linked Canadian dollar (CAD) held strong at the end of last week thanks to elevated oil prices.
Oil price movements remain the focus for CAD investors today. Could ongoing strength in crude see the Canadian dollar climb?
Data releases
08:30 NZD Services NZ PSI (Apr)
18:35 GBP BoE Greene Speech
19:30 GBP BoE L Mann Speech