Australian Dollar (AUD) Weakens as Rise in Australian Inflation Dismissed
The Australian Dollar (AUD) weakened during yesterday’s session as recent inflation figures from Australia were predicted to be dismissed by the Reserve Bank of Australia (RBA) as ‘transitionary’.
Despite inflation rising to 3.8% on the year, the ‘Aussie’ was unable to shake off concerns over the ongoing coronavirus situation in the country as Sydney extends its lockdown for a further four-week period.
An absence of economic data from Australia will instead see AUD exchange rates driven by the strength of the global market mood.
Pound (GBP) Steady on UK Coronavirus Developments
The Pound (GBP) was steady for much of Wednesday’s session as positive coronavirus developments from the UK supported the appeal of Sterling.
The news that fully-vaccinated citizens from the EU and US would be able to visit the UK without the need to quarantine was well met by investors, though it was not made evident when the change would come into force.
Today, Pound traders will look to any further domestic coronavirus developments to drive movement in GBP exchange rates.
Euro (EUR) Muted as US Dollar Rallies
Wednesday’s session saw the Euro (EUR) limited against most of the majors as a rallying US Dollar (USD) and lacklustre economic data dragged down the appeal of the single currency.
The latest consumer confidence index from the Eurozone’s largest economy, Germany, failed to impress markets. More so, the strong negative correlation between the Euro and US Dollar saw the ‘Greenback’ able to make headwind ahead of the Federal Reserve interest rate decision.
A slew of economic data including German inflation and Eurozone consumer confidence alongside the US Dollar’s strength are thought to be the main catalyst for movement in the Euro today.
US Dollar (USD) Bolstered as Markets Await Federal Reserve Decision
For US Dollar traders yesterday saw all eyes firmly focus on the Federal Reserve’s latest interest rate decision.
Whilst no policy changes were expected some analysts believed that the Fed would continue to take a more cautious tone surrounding the US economic recovery.
Today will see movement in USD exchange rates driven by the market’s reaction to the Fed alongside initial US jobless claims overnight.
Canadian Dollar (CAD) Mixed as Canadian Inflation Softens
The Canadian Dollar (CAD) was mixed for much of yesterday’s session as the most recent inflation data from Canada showed that consumer prices softened more-than-expected during June, while an uptick in oil prices helped to minimise the pullback in the commodity-correlated ‘Loonie’.
New Zealand Dollar (NZD) Struggles to Find Support
The New Zealand Dollar (NZD) struggled to find support during Wednesday’s session as a lack of data and risk-off mood did nothing to support the ‘Kiwi’.
Data Releases
Jul 29th 04:00 USD Fed Interest Rate Decision 0.25%
Jul 29th 11:00 NZD ANZ Business Confidence (Jul) 1.2
Jul 29th 17:55 EUR DE Unemployment Rate (Jul) 5.8%
Jul 29th 19:00 EUR Consumer Confidence Final (Jul) -4.4%
Jul 29th 22:00 EUR DE Inflation Rate (Jul) 3.3%
Jul 29th 22:30 USD Initial Jobless Claims (24/Jul) 380,000