Euro (EUR) Mixed following Inflation Data
A mixed consumer price index saw the Euro (EUR) trade without a clear direction yesterday. While headline inflation edged up, core inflation unexpectedly eased, creating uncertainty around the European Central Bank’s (ECB) next interest rate decision.
The safer single currency was able to gain ground against its riskier peers later in the session, as anxiety swept the markets.
Coming up, the Eurozone’s jobless rate for March could boost EUR. Economists expect it to hold at a record low for the third month in a row.
Pound (GBP) Weakens amid Signs of Easing Inflation
Although the survey exceeded forecasts, it still showed that UK factory activity remained in contraction last month. The data also pointed to easing price pressures, thereby dampening Bank of England (BoE) interest rate rise bets.
Today, UK economic data is in short supply. As a result, we may see Sterling trade in a narrow range.
US Dollar (USD) Capped by Drop in Jobs Vacancies
The US Dollar (USD) gained ground yesterday as a gloomy market mood saw traders favour the safe-haven ‘Greenback’.
However, USD saw its gains capped later in the session after a larger-than-forecast decline in job vacancies indicated a cooling US labour market. This in turn saw markets trim their expectations for more Federal Reserve rate hikes after tonight’s meeting.
The US Dollar could slump if the Fed signals tonight’s expected rate rise may be its last. However, there’s an outside chance that the Fed may strike a more hawkish tone, which would likely send USD soaring.
Canadian Dollar (CAD) Dips as Crude Prices Weaken
A slump in oil prices saw the crude-linked Canadian Dollar (CAD) fall sharply yesterday. The slump in crude prices appeared driven by global growth fears.
If oil markets remain in the red today, CAD could face further losses.
Australian Dollar (AUD) Trims Post-RBA Gains
The Australian Dollar (AUD) softened slightly overnight, trimming some of the impressive gains it made following the Reserve Bank of Australia’s (RBA) shock rate hike. The downside came despite better-than-forecast Australian data.
New Zealand Dollar (NZD) Firms following Strong Jobs Report
The New Zealand Dollar (NZD) ticked higher last night thanks to stronger-than-expected employment data.