Australian dollar (AUD) undermined by falling commodity prices
The Australian dollar (AUD) initially wavered near recent highs yesterday as the hawkish tone following the Reserve Bank of Australia’s (RBA) interest rate decision continued to underpin the ‘Aussie’.
However the Federal Reserve’s interest rate cut prompted a broad decline in the US dollar, allowing the AUD to post strong gains against the USD
Turning to today, Australia’s latest jobs data is the focus. An expected rise in unemployment in November may see AUD fall again, as it could dampen the case for another RBA rate hike.
New Zealand dollar (NZD) choppy amid market volatility
The New Zealand dollar (NZD) see-sawed yesterday as turbulence in the markets rocked NZD.
Looking ahead, global risk dynamics could drive movement in the ‘kiwi’ today. Any shifts in risk appetite could infuse the New Zealand dollar with fresh volatility.
Pound (GBP) uncertain amid turbulent trade
The pound (GBP) traded in a wide range yesterday as a lack of UK economic data left the currency exposed to wider volatility.
Global markets were turbulent ahead of the Federal Reserve decision and amid geopolitical uncertainty, prompting unpredictable movement in the pound and many of its peers.
With British data still in short supply today, Sterling could struggle to find a clear directional bias.
Euro (EUR) wobbles despite USD weakness
The euro (EUR) faced choppy trade yesterday, despite encouraging comments from European Central Bank (ECB) President Christine Lagarde about the Eurozone’s growth outlook and a weaker US dollar (USD).
Despite these tailwinds, the single currency struggled against some of its peers and faced volatility as ongoing Russia-Ukraine concerns unnerved EUR investors.
Eurozone data is absent from today’s economic calendar, potentially leaving EUR to trade on geopolitical headlines. Ongoing anxiety could subdue the common currency.
US dollar (USD) weakens ahead of Fed decision
The US dollar wavered lower yesterday amid some selling before the Federal Reserve’s expected interest rate cut.
Overnight, the US central bank announced that it had, as anticipated, lowered borrowing costs. However, commentary following the decision led to some choppy movement in the ‘greenback’.
The aftermath of the Fed policy announcement could drive USD today, bringing the possibility of US dollar volatility as markets digest the decision.
Canadian dollar (CAD) slips following BoC decision
The crude-linked Canadian dollar (CAD) was dented by falling oil prices yesterday, while the Bank of Canada’s (BoC) latest interest rate decision failed to support the currency, with Governor Tiff Macklem maintaining a steady tone despite recent strong jobs data.
Today, Canada’s latest trade figures could impact CAD. An expected uptick in exports may reflect positively on the ‘loonie’.
Data releases
10:30 AUD Unemployment Rate (Nov)
23:30 CAD Balance of Trade (Sep)
23:30 USD Initial Jobless Claims (06/Dec)