The Euro to Australian Dollar (EUR/AUD) exchange rate rallied by around 1.25% on Thursday morning.
Despite the fact that Athens’ assertions that the Hellenic nation is close to securing much-needed bailout funds were quashed by Eurozone officials, the shared currency strengthened versus many of its rivals. The appreciation is mostly the result of traders having already priced-in the prospect that Greece will default on the next payment due to the International Monetary Fund (IMF). Additional gains can be attributed to positive data out of Germany.
The Australian Dollar, meanwhile, softened across the board as global risk sentiment dampens amid the rising prospect of a 2015 Federal Reserve benchmark rate increase. Geopolitical unknowns in Europe are also plaguing trader risk-appetite. Additionally, the ‘Aussie’ (AUD) softened after domestic data failed to meet with forecast figures.
The Euro to Australian Dollar (EUR/AUD) exchange rate is currently trending in the region of 1.4263.
Euro (EUR) Exchange Rate Forecast to Trend Higher against the ‘Aussie’ on German Import Prices
Conflicting reports regarding the prospect of Greek receiving bailout funds has yet to stymie Euro gains on Thursday. This is mostly due to traders fearing recent declination was overdone given that the Greek situation has already been priced-in to a certain extent.
Aiding the Euro uptrend was mixed domestic data which erred towards the positive. One such better-than-expected data publication was German Import Prices which advanced on both an annual and a monthly basis.
The Euro to Australian Dollar (EUR/AUD) exchange rate has fallen to a low of 1.4057 today.
Australian Dollar (AUD) Exchange Rate Dives against the Euro as Private Capital Expenditure Cools
In response to futures traders and rate hawks bringing forward bets as to the timing of a Federal Reserve lending rate liftoff, trader risk-appetite dampened considerably. This was exacerbated by ongoing concern regarding the unknown impact on the market of a Greek exit from the Eurozone. As a risk-correlated currency, the ‘Aussie’ softened as a result of rocky market sentiment.
In addition to damp trader risk sentiment weighing on demand for the Oceanic currency, a poor result from the solitary Australian economic data publication aided the depreciation. First-quarter Private Capital Expenditure declined by -4.4%, a significantly larger declination than the median market forecast -2.2%.
Euro to Australian Dollar (EUR/AUD) Exchange Rate Forecast to Hold Gains ahead of German Retail Sales
Given the complete absence of further domestic data publications to provoke changes, the Euro to Australian Dollar (EUR/AUD) exchange rate is likely to hold gains for the remainder of Thursday’s European session. With that being said, however, the Australian Dollar could strengthen if Thursday’s US data prints particularly poorly. Friday will see heightened EUR/AUD volatility with several domestic data publications due for release, including German Retail Sales.
The Euro to Australian Dollar (EUR/AUD) exchange rate advanced to a high of 1.4282 today.