Australian Dollar (AUD) Dented by Retail Data
The Australian Dollar (AUD) struggled to gain against its peers on Thursday as risk sentiment remained downbeat and AU retail sales disappointed.
Preliminary retail data for the month of June revealed that sales increased by 0.2% rather than the 0.5% expected. This marks the softest rise in retail trade since a fall in December 2021, as cost-of-living pressures weakened consumer spending.
Today, Q2’s PPI data is expected to print at 5.3%, an increase on the previous reading. If the data prints as forecast, AUD may strengthen.
New Zealand Dollar (NZD) Buoyed by Confidence Data
The New Zealand Dollar (NZD) firmed yesterday as business confidence data from ANZ bank printed above expectations.
The business outlook index increased to -56.7 in July 2022 from -62.6 in June amid improving profit expectations – although it also marked the thirteenth straight month of a negative reading.
The ‘Kiwi’ may trade on external factors today, given a lack of NZ data. If risk sentiment weakens further, NZD exchange rates could weaken.
Pound (GBP) Sentiment Dampened by Living Cost Pressures
The Pound (GBP) was trapped in a narrow range on Thursday as ongoing political uncertainty weighed on Sterling sentiment.
GBP exchange rates faced further pressure amid threats of a strike at the UK’s largest container port for fear any industrial action could severely disrupt the economy.
An increase in Bank of England (BoE) consumer credit may dent Sterling appeal today, if it reveals that borrowing has increased in line with rising cost-of-living pressures.
Euro (EUR) Stumbles on German Inflation and Economic Sentiment
The Euro (EUR) weakened against its peers yesterday, subdued by falling inflation in Germany and downbeat economic sentiment in the Eurozone.
German inflation decreased to 7.5% according to July’s preliminary data, from 7.6% the previous month, edging lower for a second consecutive month. Elsewhere, the Eurozone’s economic sentiment index by more than expected to 99, its lowest level since February last year.
In the spotlight today will be the Eurozone’s latest GDP figures, which could see the Euro face fresh selling pressure if growth in the bloc slowed in the second quarter.
US Dollar (USD) Clings to Gains despite Flash GDP
The US Dollar (USD) strengthened on Thursday although flash GDP data revealed that the US economy shrank by 0.9% in Q2.
This plunged the US into a technical recession, spooking investors and underpinning demand for the safe-haven currency.
Today, the Core PCE price index – the Fed’s preferred measure of inflation – could drag on the US Dollar if it falls for the fourth consecutive month.
Canadian Dollar (CAD) Wavers on GDP Forecasts
The Canadian Dollar (CAD) traded on the back foot on Thursday. The commodity-linked currency struggling to attract support as oil prices stalled.
The publication of Canada’s latest GDP figures could act as a drag on the ‘Loonie’ later this evening, if June’s preliminary figures report another fall in growth.
Data Releases
Jul 29th 11:30 AUD PPI (Q2) 5.3%
Jul 29th 17:55 EUR German Unemployment Rate (Jul) 5.4%
Jul 29th 17:55 EUR German Change (Jul) 15,000
Jul 29th 18:30 GBP BoE Consumer Credit (Jun) £1bn
Jul 29th 19:00 EUR GDP Growth Rate Flash (Q2) 3.4%
Jul 29th 19:00 EUR Inflation Rate Flash (Jul) 8.6%
Jul 29th 22:30 CAD GDP (May) -0.2%
Jul 29th 22:30 USD PCE Price Index (Jun) 6.7%
Jul 29th 23:45 USD Chicago PMI (Jul) 55
Jul 30th 00:00 USD Michigan Consumer Sentiment Final (Jul) 51.1