Australian Dollar (AUD) Falls after Dovish RBA Comments
The Australian Dollar (AUD) slipped yesterday, undermined by dovish comments from Reserve Bank of Australia (RBA) Deputy Governor Michele Bullock.
Additionally, a fall in iron ore prices also weighed on the ‘Aussie’ through Wednesday’s session.
With no significant data today, the ‘Aussie’ is likely to be affected by global risk appetite. The fallout from the Federal Reserve’s interest rate decision could also affect the currency.
New Zealand Dollar (NZD) Boosted by Risk-On Mood
The New Zealand Dollar (NZD) firmed on Wednesday despite its correlation to the Australian Dollar (AUD). A return of risk appetite towards the end of the day helped to bolster the ‘Kiwi’.
A widening in New Zealand’s trade deficit today could prompt losses in NZD if figures print as forecast.
Pound (GBP) Slips despite Business Energy Cost Support Announcement
The Pound (GBP) fell against many of its rivals yesterday. Sterling found little support from energy support plans for UK businesses. A drop in industrial trends orders also pushed GBP lower.
Significant losses for the currency were limited by bets on an 0.75% interest rate hike from the Bank of England (BoE), however. Data last week indicated strong wage growth, supporting more aggressive action.
If the BoE goes ahead with an above-forecast rate hike today, then it could bolster the beleaguered Pound.
Euro (EUR) Drops as Russia Mobilises More Troops
The Euro (EUR) tumbled yesterday after Russia’s announcement that it would deploying additional troops to Ukraine.
The single currency had its losses curbed by bets on rate hikes the from European Central Bank (ECB). Hawkish comments from ECB President Christine Lagarde added to the speculation.
The latest ECB economic bulletin could prompt further movement in the Euro if it provides any hints regarding the central bank’s forward policy.
US Dollar (USD) Bolstered by Fed Rate Hike Bets
The US Dollar (USD) gained on Wednesday. A risk-off mood initially bolstered USD. A pullback in US Treasury bond yields capped gains for the currency later in the day, however.
On the other hand, USD remained supported by bets on a third consecutive 0.75% interest rate hike from the Fed.
The Fed’s rate hike could lend support to the currency today if the Fed pushes ahead with its planned rate hike.
Canadian Dollar (CAD) Boosted by Soaring Oil Prices
The Canadian Dollar (CAD) climbed on Wednesday. The commodity-tied ‘Loonie’ was bolstered by a near 3% rise in crude oil prices.
CAD is likely to continue to be affected by any changes in the price of oil today.
Data Releases
Sep 22nd 04:00 USD Fed Interest Rate Decision
Sep 22nd 08:45 NZD Balance of Trade (Aug) NZ$-1300M
Sep 22nd 17:00 EUR ECB Economic Bulletin
Sep 22nd 21:00 GBP BoE Interest Rate Decision 2.25%
Sep 22nd 22:30 USD Initial Jobless Claims (17/Sep) 218,000