Australian Dollar (AUD) Weakens as Markets Remain Bearish
The Australian Dollar (AUD) struggled on Thursday as a risk-off market mood suppressed support for the perceived-riskier currency.
This reversed some initial gains made on the back of bets for further aggressive rate hikes from the Reserve Bank of Australia (RBA).
Today, the ‘Aussie’ may be buoyed by China’s inflation release, which is expected to increase towards the People’s Bank of China (PBoC)’s target rate of 3%.
New Zealand Dollar (NZD) Tumbles on Lack of Data
The New Zealand Dollar (NZD) fell yesterday as a lack of significant economic data exposed the currency to losses. The ‘Kiwi’ was also negatively affected by a risk-off market mood.
Looking ahead, the New Zealand Dollar could likewise be buoyed today by positive data from China, although it may face headwinds if risk-off sentiment persists.
Pound (GBP) Trends Up as UK PM Addresses Taxation Concerns
The Pound (GBP) recovered some of its earlier losses on Thursday, as Prime Minister Boris Johnson responded to concerns voiced by several MPs regarding the cost of living.
Johnson acknowledged that the burden of taxation is currently very high, calling it ‘an aberration’ caused in part by Covid; to bring taxes down, he said, the government must introduce supply side reforms.
A lack of UK data leaves Sterling to trade on external factors today: if Johnson’s comments go down favorably the Pound may continue to firm against its peers.
Euro (EUR) Fluctuates Upbeat Lagarde Speech
The Euro (EUR) experienced some upside yesterday as European Central Bank (ECB) President Christine Lagarde struck a hawkish tone during June’s press conference.
Lagarde confirmed that the central bank plans to raise interest by 25 basis points at July’s meeting, signaling that a larger increment may be necessary in September if the medium-term inflation outlook persists or deteriorates.
However, these gains were quickly reversed amid concerns over fragmentation in the Eurozone. Worries which could leave the Euro on the back foot today.
US Dollar (USD) Buoyed by Risk-Off Mood
The US Dollar (USD) enjoyed tailwinds on Thursday as a bearish market mood drew support toward the safe-haven currency.
Disappointing US jobless claims also failed to dent ‘Greenback’ trading sentiment, as the number of claimants rose to 229K in the week ending 4 June, from 202K the week previous. Negative US data threatens the global economy, incurring further safe-haven tailwinds.
Today, US inflation will be awaited eagerly for trading inspiration. If core CPI retreats in May as expected, the argument for tightening monetary policy will weaken and USD may suffer.
Canadian Dollar (CAD) Falls as Oil Prices Sink
The Canadian Dollar (CAD) weakened against its peers yesterday amid a downturn in oil prices, amidst fears fresh lockdown measures in Shanghai could weaken global demand.
Canadian employment data will be in the spotlight today: if May’s employment change release rises as expected, CAD may enjoy some support.
Data Releases
Jun 10th 22:30 CAD Unemployment Rate (May) 5.2%
Jun 10th 22:30 CAD Employment Change (May) 30K
Jun 10th 22:30 USD Inflation Rate (May) 8.3%
Jun 10th 23:45 EUR ECB President Lagarde Speech
Jun 11th 00:00 USD Michigan Consumer Sentiment Prel (Jun) 58
Jun 11th 04:00 USD Monthly Budget Statement (May) $-120bn