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  • Dearth of ‘Aussie’ Data Limited AUD Movement – Data calendar fuller this week.
  • Pound Slips as Q1 Growth Revised Lower – Sterling sentiment also dampened by contraction in business investment.
  • EUR Fluctuates as Italy Passes Controversial Budget – Is Rome on a collision course with the EU?
  • CAD Broadly Strengthens – Strong Canadian GDP figures bolster hopes of an October Hike from the BoC.

Manufacturing Data Could Spark AUD Exchange Rate Movement 

After last week’s empty Australian data calendar we’ve got a bit more to sink our teeth into this week, including today’s AiG Performance of Manufacturing Index.

If the gauge of output for the manufacturing sector rises from 56.7 the Australian Dollar could strengthen during the local session.

However, investors will also be looking ahead to Tuesday and the Reserve Bank of Australia’s (RBA) interest rate decision. The direction the ‘Aussie’ takes over the rest of the week will be dictated by the tone of the bank’s policy statement.

Pound Sterling (GBP) Exchange Rates Stall as UK Q1 Growth Revised Lower

The Pound (GBP) found itself on the defensive at the end of last week’s session, with the currency trending lower against the majority of its peers as the UK’s latest GDP figures saw domestic growth revised down to just 0.1% in the first quarter.

The accompanying business investment figures also proved negative for Sterling on Friday as Brexit uncertainty saw investment contract a further 0.7% between June and April.

This downtrend in GBP exchange rates may continue into this week as well, with the Pound poised to fall if activity in the UK’s manufacturing sector slowed again in September as forecast.

EUR Exchange Rates Fluctuate amid Italian Budget Concerns

Euro (EUR) exchange rates came under a bit of pressure at the end of last week’s session as Italy’s government passed a new budget which seeks to target a deficit of 2.4% of GDP, flouting the EU’s cap of 2% and prompting concerns that this could add to Italy’s already sizable debt pile.

However, the Euro could open this week’s session on a more positive note if the Eurozone’s latest labour figures reveal unemployment in the bloc fell in August.

USD Exchange Rate Momentum Continues

US Dollar (USD) exchange rates largely strengthened heading into the weekend, with the safe-haven currency consolidating its gains thanks to a hawkish rate hike from the Federal Reserve and bumper US GDP figures.

Looking ahead the US will publish its manufacturing PMI tomorrow, with USD likely to enjoy further gains if the US records another robust expansion in factory activity.

CAD Exchange Rates Climb as Canadian GDP Beats Expectations

The Canadian Dollar (CAD) broadly strengthened on Friday as the ‘Loonie’ shot higher in the wake of Canada’s latest GDP figures. Stronger-than-expected growth bolstered expectations of a rate hike from the Bank of Canada in October and sent CAD soaring against the majors.

NZD Exchange Rates Set to React to Dairy Auction

New Zealand Dollar (NZD) exchange rates could slide this week if the price of dairy, New Zealand’s key commodity, declines at the latest Global Dairy Trade Auction. However, as dairy prices have fallen at the last three auctions, a rebound could give NZD exchange rates a lift.  

Data Released

08:30 AUD AiG Performance of Manufacturing Index 
11:00 AUD TD Securities Inflation
18:30 GBP Markit UK PMI Manufacturing
19:00 EUR Eurozone Unemployment Rate

Post by TorFX

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