US Dollar (USD) Plunges on Worrying Employment Data
The US Dollar came crashing back to earth yesterday, with USD exchange rates plummeting from multi-month highs in response to some worrying US jobs data.
The latest ADP employment figures reported the US economy only added 89,000 jobs in September. This stoked speculation that the US labour market is slowing and dampened expectations for further interest rate hikes from the Federal Reserve.
Today will see the publication of the latest US initial jobless claims data. If unemployment claims rose last week this would support suggestions the US jobs market is decelerating and could extend the US Dollar’s losses.
Pound (GBP) Buoyed by Services PMI Revision
The Pound (GBP) trended broadly higher during yesterday’s European session, following the publication of the UK’s latest services PMI.
September’s finalised figures saw the index revised up from 47.2 to 49.3. While this was still a contraction, it painted a far less worrying picture of the UK’s economic performance in the third quarter.
UK data is thin on the ground today. As a result, any movement in the Pound could be limited.
Euro (EUR) Supported by USD Weakness
The Euro’s (EUR) negative correlation with the US Dollar (USD) offered a boost for the single currency on Wednesday, amid the sharp pullback in USD exchange rates.
However, this upside was tempered by the release of the Eurozone’s latest retail sales print, as August’s figures reported the largest contraction in sales growth since December.
Today’s session was kicked off with the publication of Germany’s latest trade figures, which could see the Euro struggle this morning after reporting another contraction in exports in August.
Canadian Dollar (CAD) Slides amid Oil Price Slump
The Canadian Dollar (CAD) stumbled on Wednesday, as the oil-sensitive ‘Loonie’ was undermined by a sharp pullback in crude prices.
Coming up, CAD exchange rates may remain on the defensive this afternoon as economists forecast the latest Ivey PMI will report activity in Canada’s private sector slowed to a crawl last month.
Australian Dollar (AUD) Strengthens on Upbeat Trade Figures
The Australian Dollar (AUD) rallied overnight, with positive risk flows and stronger-than-expected domestic trade figures helping to make the ‘Aussie’ more attractive to investors.
New Zealand Dollar (NZD) Buoyed amid Improving Risk Appetite
The New Zealand Dollar (NZD) also ticked higher in overnight trade, with the risk-sensitive ‘Kiwi’ benefitting from a more optimistic market mood.