Australian dollar (AUD) stumbles following RBA minutes
The Australian dollar (AUD) fell yesterday after the Reserve Bank of Australia’s (RBA) latest meeting minutes struck a more dovish tone than anticipated.
Although policymakers are concerned about inflation, many sounded cautious about the impact of higher interest rates, prompting investors to pare back their more hawkish rate hike bets.
Turning to today, the market mood could determine the risk-sensitive Australian dollar’s direction. A risk-off mood may weigh on AUD.
New Zealand dollar (NZD) falls as consumer spending declines
The New Zealand dollar (NZD) also dropped yesterday after new data revealed a 1.3% contraction in domestic card spending last month.
Risk appetite could be the defining factor for NZD today, with the ‘kiwi’ poised to fall if rising tensions in the Middle East sour the market mood.
Pound (GBP) finds support despite soft jobs data
The pound (GBP) managed to tick higher against its weaker rivals yesterday, despite underwhelming UK jobs data.
Unemployment unexpectedly rose in the three months to March, while wage growth slowed. However, the number of people in employment increased by a stronger-than-expected 148,000.
Looking ahead, the UK’s latest consumer price index is the focus for GBP investors today. Could cooling inflation see Sterling weaken?
Euro (EUR) dips as USD rises
The euro (EUR) faced pressure yesterday as the currency’s negative correlation with the rising US dollar (USD) weighed on EUR demand.
Meanwhile, a lack of Eurozone economic data left the euro without much support.
Later today, a forecast rise in German producer price inflation could underpin EUR, if it’s seen as potentially adding to consumer price inflation across the bloc.
US dollar (USD) climbs amid geopolitical tensions
The safe-haven US dollar marched higher during yesterday’s session as geopolitical concerns led to a risk-averse market mood.
US President Donald Trump warned that he may need to strike Iran again, while Tehran said it will ‘open new fronts’ of the war if American attacks resume.
USD investors may remain focused on the Middle East today. If tensions continue to flare, the US dollar could catch bids.
Canadian dollar (CAD) buoyed despite softer inflation
The oil-sensitive Canadian dollar (CAD) also rose yesterday as crude prices climbed, although softer-than-forecast domestic inflation figures limited CAD’s upside.
Canadian economic data is in short supply today, likely leaving the Canadian dollar to trade on crude price movements.
Data releases
16:00 EUR German PPI (Apr)
16:00 GBP Inflation Rate (Apr)