US Dollar (USD) Crashes as ADP Employment Figures Fall
Yesterday, the US Dollar (USD) fell against most major peers following a surprise drop in the latest ADP employment figures.
Following Tuesday’s JOLTs data, the release further indicated growing slack in the US labour market. This fed into diminished bets on further rate hikes from the Federal Reserve, as the US economy appears to slow.
Today, the core PCE price index for July is due to print. As the Fed’s preferred gauge of inflation, forecasts of an uptick could boost the ‘Greenback’.
Pound (GBP) Climbs amid Risk-On Trade
Despite the continued lack of UK data releases, the Pound (GBP) rallied yesterday amid elevated levels of risk appetite.
Furthermore, bets on central bank divergence likely brought further support for Sterling. The Bank of England (BoE) is expected to hike interest rates further, while other central banks may have reached their peaks.
This morning, BoE Chief Economist Huw Pill delivered a speech which has so far proved uninspiring for Sterling. Could his words bring cheer as the session progresses?
Euro (EUR) Surges on Hotter-than-Expected German Inflation
German inflation printed above forecasts yesterday, which brought strength to the Euro (EUR) as markets increased bets on another European Central Bank (ECB) rate rise.
The common currency also enjoyed its strong negative trading relationship with a weakening US Dollar.
Thus far today, the Euro has stumbled following a shock fall in German retail sales. Further losses may come later this morning should Eurozone inflation cool as forecast. However, with French and German inflation beating expectations, the Eurozone figure could surprise to the upside.
Canadian Dollar (CAD) Undermined by USD Correlation
Due to its close correlation to a crumbling US Dollar, the Canadian Dollar (CAD) weakened over the course of yesterday’s trade.
With data remaining in short supply, the commodity-linked ‘Loonie’ may trade alongside oil price dynamics during today’s session.
Australian Dollar (AUD) Bolstered by Chinese Data
The Australian Dollar (AUD) rose overnight following better-than-forecast Chinese private sector data.
New Zealand Dollar (NZD) Fluctuates amid Business Confidence Miss
Following a disappointing business confidence index, the New Zealand Dollar (NZD) wavered in overnight trade.