Australian dollar (AUD) trends lower amid risk-off mood
The Australian dollar (AUD) softened against many of its peers yesterday as fresh Middle East tensions soured the market mood.
Attacks on two commercial vessels in the Strait of Hormuz reignited concerns about the fragile US-Iran peace deal, thereby dampening the appeal of the risk-sensitive ‘Aussie’.
Australian data is in short supply today, likely leaving AUD to trade on risk dynamics once again.
New Zealand dollar (NZD) drops as sentiment sours
The New Zealand dollar (NZD) also fell yesterday as sentiment soured, with the ‘kiwi’ weakening against most of its rivals.
Turning to today, the Reserve Bank of New Zealand (RBNZ) interest rate decision is in focus. An expected rate hike could boost NZD, while investors will also be eager for any hints on whether further tightening is likely.
Pound (GBP) edges lower amid lack of data
The pound (GBP) trended slightly lower against its stronger counterparts on Tuesday, as a lack of UK data left Sterling without much support.
However, GBP avoided more notable losses as fading fears of UK political instability continued to underpin the currency.
UK data remains thin on the ground during today’s session, potentially leaving the pound to trade within a narrow range.
Euro (EUR) uncertain despite strong German industrial production
The euro (EUR) was mixed yesterday, with the safer single currency garnering support against riskier rivals amid an anxious market mood.
Stronger-than-forecast German industrial production figures also lent EUR support, although the common currency suffered from its negative correlation with the rising US dollar (USD).
Amid a lack of Eurozone data today, the common currency could find itself subdued.
US dollar (USD) firms as risk aversion takes hold
The US dollar attracted support yesterday, with a risk-off tilt in markets boosting demand for the safe-haven ‘greenback’.
Following the strikes in the Strait of Hormuz, markets are wary of further escalation.
Looking forward, the US dollar may be muted today as investors look ahead to the publication of the Federal Reserve’s June meeting minutes overnight.
Canadian dollar (CAD) climbs as oil prices rise
The commodity-linked Canadian dollar (CAD) gained ground yesterday, as the recent attacks in the Strait of Hormuz triggered a rise in oil prices.
With Canadian data thin on the ground today, crude prices could drive CAD exchange rates.
Data releases
12:00 NZD RBNZ Interest Rate Decision