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Daily Currency Update: CAD Fluctuates on BOC Comments, Aussie Falls as RBA Hints at Rate Cuts

Published: 21 Apr at 12 PM Tags: Euro, Dollar, Pound Sterling, America, UK, Eurozone, Australian Dollar, New Zealand Dollar, Canadian Dollar, Australia, New Zealand, USA, Canada, Germany,

Pound Sterling
Prior to the publication of minutes from the Bank of England’s latest policy meeting, the Pound was holding previous gains against the Euro but trending lower against the US Dollar. The GBP/EUR pairing achieved a high of 1.3944 as the odds of a Grexit occurring rose. If tomorrow’s BoE minutes are even slightly hawkish, the Pound/Euro exchange rate could advance above 1.40.

The German ZEW Current Situation Survey may have decimated forecasts by leaping from 55.1 to 70.2 in April, but the German and Eurozone Economic Sentiment indexes weren’t quite as impressive. The mixed results, coupled with persistent ‘Grexit’ concerns, put the Euro under notable pressure and the common currency struggled against a number of its rivals.

US Dollar
The US Dollar benefited from a fall in risk appetite and gained on several of its less reliable peers in spite of pushed back expectations regarding a US interest rate increase. US data is lacking until tomorrow, when the nation’s House Price Index and Existing Home Sales numbers will be issued. Should these reports add to the recent trend of concerning US ecostats, we may see the ‘Greenback’ pare gains as the week progresses.

Australian Dollar
Although the ‘Aussie’ later recovered some of its initial losses, the South Pacific currency tumbled in response to commentary from the Reserve Bank of Australia. The central bank intimated that interest rates could be cut in the near future if Australia’s inflationary outlook doesn’t improve, and the Australian Dollar accordingly fell against its US and British peers.

New Zealand Dollar
After the RBA meeting minutes were published, concerns that the Reserve Bank of New Zealand could follow the lead of its Australian relation and cut borrowing costs left the ‘Kiwi’ trending in a broadly weaker position. Tomorrow’s Australian inflation numbers will have an impact on the New Zealand Dollar as they might encourage an immediate rate revision from the RBA.

Canadian Dollar
After the chief of the Bank of Canada indicated that the central bank has no plans to cut interest rates below their current level, the Canadian Dollar advanced. The ‘Loonie’ also tracked the US Dollar slightly higher as investors turned to the ‘Greenback’ in an uncertain geopolitical climate. Gains were limited due to fluctuating oil prices, but today’s Canadian Wholesale Sales numbers may inspire additional movement.
As of Tuesday, 21st April 2015, the Pound Sterling currency rates mentioned within this news item were as follows:

GBP EUR exchange rate was 1.3902, GBP USD exchange rate was 1.4927, GBP AUD exchange rate was 1.9345, GBP NZD exchange rate was 1.9477, and GBP CAD exchange rate was 1.832.
Laura Parsons About Author: (360 Posts)Laura works in the financial sector as a currency analyst, studying the latest global economic developments and assessing their impact on the foreign exchange market. Laura uses her currency knowledge to write articles focussing on market movements and trends for several independent financial websites.

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