The US dollar is climbing as personal consumption and spending rates grew faster than analysts expected during September, reflecting a healthier consumer market. We’ll get another measure of the US economy with two preliminary manufacturing sector forecasts set to come out later this morning.
Overseas, the euro is falling at its fastest rate against the US dollar since May as investors speculate that the European Central Bank will continue its asset-purchase stimulus program while the US Federal Reserve gets ready to raise interest rates. Poor retail sales results out of Germany for September are also putting downward pressure on the shared currency this morning. The broader Eurozone eeked out 0.3% GDP growth and 0.5% consumer price growth during the third quarter, as expected.
The pound is also trading lower against a stronger US dollar after this morning’s release of mixed consumer borrowing results for September. While UK mortgage approvals and net lending levels to individuals picked up more than analysts anticipated during September, consumer credit levels came in about 6% below expectations for the month.
In the Pacific, the Australian dollar is rallying as investors wait for tonight’s manufacturing sector forecasts and the Reserve Bank of Australia’s interest rate decision. While the central bank is expected to hold rates at current levels, a surprise interest rate cut could signal a pessimistic outlook for the Australian economy and weaken the currency. Investors are also waiting on China’s business activity readings out tonight to see how Australia’s largest trading partner is doing.
The Japanese yen is weakening as investors continue to favor the US dollar’s perceived safe-haven status. The currency did rally earlier this morning after September’s housing starts and construction orders grew more than analysts projected. Investors are waiting on tonight’s manufacturing output results for October and the Bank of Japan’s interest rate decision.
Up north, the Canadian dollar is trading choppy as September’s industrial product prices grew twice as fast as analysts had forecast while today’s oil prices are falling toward $48 per barrel.
EURUSD: The euro is weakening against a stronger US dollar on lower retail spending in Germany and as investors anticipate continued stimulus from the ECB.
GBPUSD: The pound is also trading lower against the stronger US dollar with on mixed consumer borrowing results.
AUDUSD: The Aussie dollar is climbing as investors await tonight’s manufacturing sector forecasts and the RBA’s interest rate decision.
USDCAD: The Canadian dollar is trading choppy with strong industrial product price growth and falling oil prices.