Australian Dollar (AUD) Trends Slightly Higher amid Mixed Economic Stimuli
The Australian Dollar (AUD) traded in a mixed range on Tuesday, as risk sentiment wavered and both manufacturing and services activity in August missed forecasts.
Australia’s flash PMI data revealed that services activity unexpectedly contracted for the first time in seven months. Capping losses, manufacturing activity marked the twenty-seventh consecutive month of improvement – although growth in the sector was weaker than in July.
External factors may drive ‘Aussie’ movement today, given a lack of significant economic data.
New Zealand Dollar (NZD) Supported by Brief Risk-On Mood
The New Zealand Dollar (NZD) enjoyed limited gains yesterday, though lost some momentum as economists predicted the currency may soon come under pressure.
Hawkish rhetoric from the Reserve Bank of New Zealand (RBNZ) has previously been seen as NZD-positive, but markets are increasingly worried that a bolder policy stance risks a ‘hard landing’ for the country’s economy.
Today, the ‘Kiwi’ could trend up if NZ commodities perform well – although a risk-off mood could suppress demand for the currency.
Pound (GBP) Stable Despite Underwhelming PMIs
The Pound (GBP) traded sideways on Tuesday, following the publication of the UK’s latest PMI figures.
While the UK’s manufacturing PMI fell into contraction territory in August better-than-expected services data lent some support to Sterling.
In the absence of any notable UK economic data, will we see domestic headlines act as the main catalyst of movement in the Pound today?
Euro (EUR) Drops to 20-Month Low against USD
The Euro (EUR) initially fell to a two-decade low against the US Dollar (USD) yesterday after the latest Eurozone PMIs reported growth in the bloc’s services sector came close to stalling in August.
Elsewhere, the Euro continued to be pressured by rising gas prices. Economists warn the recent surge makes a Eurozone recession almost inevitable.
US Dollar dynamics may drive EUR movement today, although demand for the single currency is likely to remain low so long as Europe’s looming energy crisis remains in focus.
US Dollar (USD) Tumbles as PMIs Disappoint
The US Dollar was able to retain some strength against its peers in the European morning, but soon slumped against its peers following August’s PMI release.
Business activity in the US private sector contracted at a much faster pace than expected this month, with both manufacturing and services data missing expectations. Consumer demand has dampened recently given aggressive interest rate hikes and inflationary pressures.
Today, an increase in July’s durable goods orders could bolster the ‘Greenback’ – although the rise looks to be smaller than in June.
Canadian Dollar (CAD) Sinks on Weak Oil Forecasts
The Canadian Dollar (CAD) strengthened initially on Tuesday as Saudi Arabia signalled that oil cartel OPEC may reduce output, bolstering crude prices.
However, the ‘Loonie’ subsequently fell as analysts forecast a fall in the value of the black gold.
Data Releases
Aug 24th 09:00 USD Fed Kashkari Speech N/A
Aug 24th 22:30 USD Durable Goods Orders (Jul) 0.6%