The Australian and New Zealand Dollars edged lower on Friday, as upbeat data helped the U.S. Dollar reverse some of its losses since Wednesday when dovish remarks by the U.S. Federal Reserve helped bring an end to its month-long rally. Meanwhile, profit-takers hit the Aussie and Kiwi as a shift in investor sentiment sent up a caution flag ahead of the weekend. U.S. consumer spending surged in June as vaccinations against COVID-19 boosted demand for travel-related services, but part of the increase reflected higher prices, with annual inflation accelerating further above the Federal Reserve’s 2% target, Reuters reported.
The Australian and New Zealand Dollars are trading lower on Friday, pressured by a drop in demand for higher risk currencies that is being fueled by a plunge in global equity markets. The Aussie and Kiwi are being underpinned, however, by a weaker U.S. Dollar. Meanwhile, the Covid situation in Australia is worsening, raising fears that the country will experience another virus-related contraction during the third quarter.
It’s a busy day ahead on the economic calendar. Economic data from the Eurozone, Canada, and the U.S will be in focus today.