Disappointing Eurozone stats have triggered a Euro to Australian Dollar dip today, ahead of a high-impact Australian central bank meeting next week.
- EUR AUD trades down at 1.4836 – AUD EUR rate rises to 0.6738
- Euro weakens on German job stats – Unemployment rises instead of falling
- Australian Dollar boosted by iron ore costs – Talk of hawkish RBA policy shift
- Eurozone manufacturing stats out Monday – High-impact RBA rate decision due
Recent Euro movement has been negative against the Australian Dollar, but the EUR AUD exchange rate remains near the best in a year.
Euro Dips after Surprise Rise in German Unemployment
The Euro’s slight dip against the Australian Dollar today comes after German unemployment rate stats failed to match forecasts.
It had been expected that the German unemployment change for June would show a drop of -10k persons, but instead it rose by 7k.
This upset failed to shift the overall unemployment rate from 5.7%, but was still not what traders had been hoping for.
AUD EUR Trades at over Two-Week Low despite Iron Ore Price Support
Today has seen the Australian Dollar appreciate by 0.3% against the Euro, at a rate of around 0.6736.
While this has been positive movement, the Australian Dollar remains at its worst exchange rate against the Euro in over two weeks.
Pushing the pairing up today has been commodities news – iron ore prices have risen to their best level in eight weeks.
Elsewhere, former Reserve Bank of Australia (RBA) official John Edwards has estimated that the RBA may raise interest rates consistently throughout 2018-2019.
EUR AUD Forecast: Possible Turbulence ahead on Eurozone Jobless Rate
Looking ahead to next week, Monday will open with a spread of high-impact Eurozone announcements.
First off will be Eurozone-wide PMI figures for June, including the overall Eurozone as well as France, Greece and Germany.
Forecasts have been broadly positive, with activity growth forecast in France and the Eurozone. Less supportively, German manufacturing is predicted to slow slightly, while the previous Greek figure showed an industry in contraction.
Following these key measures of Eurozone manufacturing output will be the overall Eurozone unemployment rate for May. This previously showed 9.3% in April, the lowest rate since 2009. Another reduction may prove highly beneficial to the Euro and push it up sharply.
Monday’s Australian domestic data will also cover manufacturing, but the more impactful news will be Tuesday’s Reserve Bank of Australia (RBA) interest rate decision.
The RBA could leave interest rates at 1.5% for another month, but any hints that the supposed string of rate hikes could be upcoming may trigger a sharp AUD appreciation.
Current Interbank EUR AUD Exchange Rates
At the time of writing, the Euro to Australian Dollar (EUR AUD) exchange rate was trading at 1.4841 and the Australian Dollar to Euro (AUD EUR) exchange rate was trading at 0.6736.