Australian dollar (AUD) struggles amid gloomy mood
The Australian dollar (AUD) was subdued yesterday as an anxious market mood continued to dampen demand for the risk-sensitive currency.
Trade remained cautious amid concerns about how the crisis in the Middle East could impact the global economy.
Australia’s leading index could aid the ‘Aussie’ today, if it shows a 0.2% improvement in August, as expected.
New Zealand dollar (NZD) touches two-month lows as sentiment sours
The New Zealand dollar (NZD) also trended broadly lower yesterday, touching two-month lows against some rivals, amid the risk-off mood.
NZD is enjoying some support this morning after new data showed New Zealand consumer confidence improved in the third quarter. However, any shifts in risk sentiment could determine the currency’s direction moving forward.
Pound (GBP) choppy as markets digest jobs data
The pound (GBP) faced uncertain movement yesterday as markets digested the UK’s latest jobs report.
Although unemployment held steady, rather than rising as forecast, the data also contained signs of underlying weakness in the British labour market.
Looking forward, the UK’s consumer price index is the focus for GBP investors today. Rising inflation in August could support Sterling.
Euro (EUR) mixed as German data disappoints
The euro (EUR) also struggled to find a clear directional bias yesterday following Germany’s latest ZEW economic sentiment index.
The indicator missed forecasts, disappointing EUR investors. However, it still pointed to a fifth consecutive improvement in September, with the index edging up to its highest level since February.
Today, an expected contraction in Eurozone industrial production in July could dent the common currency.
US dollar (USD) holds strong as markets eye Fed decision
The US dollar (USD) remained supported yesterday as a risk-averse mood and Federal Reserve interest rate hike bets continued to underpin the currency.
However, the ‘greenback’ also seemed to have hit a ceiling, with USD struggling to push higher ahead of the looming Fed decision.
A forecast recovery in US retail sales in August could underpin the US dollar today. However, gains may be limited ahead of the Fed announcement tomorrow morning.
Canadian dollar (CAD) falters as oil prices fluctuate
The commodity-sensitive Canadian dollar (CAD) found initial success yesterday amid rising oil prices before stumbling in the evening as crude fluctuated.
With Canadian data thin on the ground today, crude prices could drive CAD exchange rates once again. If oil continues to trade above $100 per barrel, the ‘loonie’ may enjoy support.
Data releases
07:00 NZD Westpac Consumer Confidence (Q3)
11:00 AUD Westpac Leading Index (Aug)
16:00 GBP Inflation Rate (Aug)
19:00 EUR Industrial Production (Jul)
22:30 USD Retail Sales (Aug)