Euro (EUR) Climbs amid Risk-Off Trade
The Euro (EUR) rallied yesterday, with the safer single currency catching bids amid widespread risk aversion.
In addition, a pullback in the US Dollar (USD) also aided EUR, due to the currencies’ strong negative correlation.
The euro is off to a slow start this morning in response to a surprise decline in Germany’s producer price index in September.
Pound (GBP) Uncertain amid Lack of Data
The Pound (GBP) faced mixed movement yesterday, as a lack of new economic data left the currency to trade without a clear direction.
Worries about a recession put some pressure on the Pound, while the possibility of another Bank of England (BoE) interest rate hike limited losses.
Turning to today, Sterling looks to end the week on a sour note after the UK’s latest retail sales figures reported a much larger-than-expected contraction in sales growth last month.
US Dollar (USD) Stumbles as Treasury Yields Decline
The safe-haven US Dollar was initially strong yesterday amid a risk-off market mood.
However, USD relinquished a large portion of its gains during European trade due to a pullback in US Treasury yields.
The ‘Greenback’ may trade on market risk dynamics through much of today’s trade, while speeches from Federal Reserve policymakers in the afternoon could also impact USD.
Canadian Dollar (CAD) Slips as Oil Prices Drop
The crude-linked Canadian Dollar (CAD) softened yesterday as a dip in oil prices dented CAD exchange rates. News that the US was lifting oil sanctions on Venezuela pulled crude prices lower.
An expected contraction in Canadian retail sales could dent CAD today. Forecasters expect domestic sales to have shrunk 0.3% in August.
Australian Dollar (AUD) Undermined by Risk-Off Trade
The Australian Dollar (AUD) trended lower overnight on Thursday as growing unease over the situation in the Middle East left skittish investors to shun the risk-sensitive ‘Aussie’
New Zealand Dollar (NZD) Stumbles amid Downbeat Mood
The New Zealand Dollar (NZD) also retreated overnight as heightened geopolitical tensions limited demand for riskier assets like the ‘Kiwi’.