The AUD/NZD, AUD/USD and AUD/GBP exchange rates will be subject to volatility over the course of next week, especially with British and North American growth figures due for publication.
Demand for the Australian Dollar (AUD) was boosted on Friday as China cut its benchmark interest rate in an attempt to shore up growth in Australia’s largest trading partner. The Australian Dollar to US Dollar (AUD/USD) and Australian Dollar to Pound Sterling (AUD/GBP) exchange rates were buoyed by the news, and the commodity-driven New Zealand Dollar was also boosted.
AUD/NZD to Hold Steady, AUD/USD to Soften and AUD/GBP to Strengthen on Monday
The Australian Dollar is likely to be subject to foreign currency changes on Monday as a result of a lack of influential data. The Weekly Consumer Confidence Index will have minimal impact on wider market movement, but should initiate ‘Aussie’ (AUD) changes. However, with the data due late on Monday evening, its impact is more likely to affect Tuesday’s proceedings.
An absence of data pertaining to New Zealand on Monday will see ‘Kiwi’ (NZD) changes dictated by foreign currency movement. However, Sunday’s Net Migration data may have an impact on Monday morning.
That being said, the New Zealand Dollar did soften during the Australian session.
According to the New Zealand Herald; ‘The New Zealand dollar fell from its New York highs at the end of last week, having jumped against the greenback after China unexpectedly cut interest rates and European Central Bank President Mario Draghi pledged to whatever was needed to underpin the region’s economy.’
US data will be of interest to those invested in the ‘Greenback’ (USD) and has the weighting to provoke market volatility. The Services and Composite PMIs are significant because the services sector accounts for a large proportion of the US Gross Domestic Product.
A complete absence of British economic data on Monday will see the Pound Sterling subject to changes in foreign currencies.
AUD/NZD to Soften, AUD/USD to Advance and AUD/GBP to Hold Steady
A dearth of Australian data on Tuesday will see the ‘Aussie’ fluctuate as a result of foreign currency changes.
The New Zealand Dollar is likely to advance should the Reserve Bank of New Zealand 2-Year Inflation Expectation data hit target.
The US Dollar is likely to soften in the early half of the London session on Tuesday. This is as a result of traders pulling away ahead of the afternoon’s growth data. The US Gross Domestic Product is forecast to decline from 3.5% to 3.2%.
Sterling movement is likely to be dictated by the solitary British data publication on Tuesday. Loans for House Purchase data has enough weighting to push Sterling in a certain direction.
AUD/NZD to Strengthen, AUD/USD to Decline, AUD/GBP to Advance
Although Wednesday’s Australian data is of little consequence in terms of provoking wider market movement, it will be of interest to those trading with the ‘Aussie’. Construction Work Done hit -1.2% previously and Consumer Sentiment printed at 110.9.
With a lack of data pertaining to New Zealand until later in the evening, the ‘Kiwi’ is likely to soften in anticipation. Trade Balance data will be of interest to those invested in the New Zealand Dollar, and is likely to impact upon ‘Kiwi’ movement on Thursday.
With a veritable smorgasbord of domestic data publications on Wednesday, the US Dollar has the potential to fluctuate. However, the most significant data publication, in terms of its weighting, is Durable Goods Orders which is forecast to increase from -1.3% to -0.5%.
The Pound Sterling is likely to soften on Wednesday morning ahead of the GDP data. Any declination will compound losses and the Pound will struggle to recover quickly.
AUD/NZD to Fluctuate, AUD/USD to Strengthen and AUD/GBP to Advance
In terms of Australian data, Thursday’s New Home Sales and Private Capital Expenditure publications are unlikely to provoke ‘Aussie’ volatility. However, China’s Industrial Profits data is likely to impact upon the Australian Dollar.
The New Zealand Dollar will see much of its movement dictated by the results from Wednesday evening’s data. However, the Chinese data on Thursday will also impact upon ‘Kiwi’ movement. Building Permits is unlikely to have any significant impact upon the South Pacific asset.
An absence of US data will see the ‘Buck’ (USD) subject to alterations in foreign currencies. It is possible, however, that is Wednesday’s US data prints positively traders will take advantage of the quiet Thursday to lock in profits.
A solitary British economic data publication on Thursday will have minimal impact on Sterling movement. The Lloyds Business Barometer hit 35 previously.
AUD/NZD to Strengthen, AUD/USD to Gain, AUD/GBP to Soften
Friday’s Australian data will be of interest to those invested in the ‘Aussie’, although it will have little bearing over wider market movement. Private Sector Credit hit 5.4% previously on a yearly basis. China’s Leading Index data may have an impact on ‘Aussie’ movement.
New Zealand Business Confidence has the potential to provoke ‘Kiwi’ volatility because it is a good early indicator for the direction of the economy, rising before economic boon and falling prior to recessions. Activity Outlook will also be of interest to those invested in the New Zealand Dollar.
US data will be of little consequence and is unlikely to impact upon US Dollar movement on Friday. NAPM-Milwaukee hit 65.61 previously.
The British Consumer Confidence Survey is comparatively significant in terms of its potential to provoke wider market movement. An improvement on the previous figure of -2 should see the Pound advance against the majority of its major peers.
At the close of last week…
The Australian Dollar to New Zealand Dollar exchange rate was trending in the region of 1.1010.
The Australian Dollar to US Dollar exchange rate was trending in the region of 0.8676.
The Australian Dollar to Pound Sterling exchange rate was trending in the region of 0.5535.
