USD pulls back as Chinese outlook improves
Wednesday 1 March, 2023
Daily Currency UpdateThe USD hit highs against most major currencies yesterday before seeing losses related to a disappointing consumer confidence release. The movement against the USD continued mildly overnight as the Chinese Purchasing Managers’ Index data showed a result of 52.6 on the scale. This turns our focus to commodities in the hopes that stronger demand from China will drive global growth. The results of the US Institute of Supply Management manufacturing survey this morning are expected to show that the opinion of purchasing managers in the manufacturing industry is on the rise. The expected consensus estimate is set to come in at 48 versus the previous reading of 47.2.
Key MoversAsian markets, especially Hong Kong’s Hang Seng, were up after the Chinese Purchasing Managers’ Index data came in at 52.6, the highest it has been since 2012. The only dip in the Asia-Pacific area was the Aussie dollar due to the gross domestic product data, which showed a disappointing 2.7% rather than the previously released 5.4%. The case for the European Central Bank (ECB) to hike rates further received a helping hand today from the release of German Consumer Price Index data. Inflation in Germany rose at an elevated 8.7% rather than dropping to 8.5% as expected. This is stoking expectations for another rate hike from the ECB. The Canadian dollar is underperforming against most major currencies this morning as equities are down to start trading. There is no data set to be released in Canada for the remainder of the week so the Loonie will be most impacted by external movement and releases.
- EUR/USD: 1.0568 - 1.0691 ▲
- GBP/USD: 1.1966 - 1.2118 ▼
- AUD/USD: 0.6702 - 0.6835 ▲
- USD/CAD: 1.3522 - 1.3655 ▲