U.S Inflation, FOMC Member Chatter, and COVID-19 Keeps the Dollar in the Spotlight

Earlier in the Day:

It was another relatively busy start to the day on the economic calendar this morning. The Aussie Dollar was in back action this morning.

For the Aussie Dollar

Following disappointing business confidence figures from Tuesday, consumer confidence was in focus this morning.

In August, the Westpac Consumer Confidence Index fell by 4.4% to 104.1. In July, the Index had risen by 1.5% to 108.8.

According to the latest Westpac Report,

• Extended lockdowns in most of NSW weighed on consumer sentiment in the month.
• While down in the month, however, confidence remained above readings seen prior to the pandemic.

Looking at the sub-components,

• Economic conditions next 12-months slid by 8.3% to 100.4. The long run average sits at 91.0.
• A marked jump in the Unemployment Expectations Index was also noteworthy. In August, the index jumped by 13.7% to 124.6. In spite of the spike, the index remained below the long-run average of 129.9.
• Family finances vs a year ago fell by a modest 1.9% to 91.9, with finances next 12-months down 2.7% to 107.0.

The Aussie Dollar moved from $0.73437 to $0.73420 upon release of the figures. At the time of writing, the Aussie Dollar was down by 0.16% to $0.7338.

Elsewhere

At the time of writing, the Japanese Yen was down 0.09% to ¥110.670 against the U.S Dollar, with the Kiwi Dollar  down by 0.14% to $0.6999.

The Day Ahead

For the EUR

It’s another relatively quiet day ahead on the economic data front. Finalized July inflation figures for Germany and Italy are due out later today.

Barring any marked upward revision from prelim figures, however, we don’t expect too much influence from the numbers.

At the time of writing, the EUR was down by 0.01% to $1.1719.

For the Pound

It’s yet another quiet day ahead on the economic calendar. There are no material stats due out to provide the Pound with direction.

At the time of writing, the Pound was down by 0.12% to $1.3826.

Across the Pond

It’s a relatively busy day ahead on the economic calendar.

Inflation figures for July are due out later in the day. Following impressive nonfarm payroll figures, a further pickup in inflationary pressures would drive demand for the Greenback.

Any FOMC member chatter would draw plenty of interest as the markets look to see whether the talk of tapering gathers momentum.

At the time of writing, the U.S Dollar Spot Index was up by 0.06% to 93.113.

For the Loonie

It’s yet another particularly quiet day on the economic calendar. There are no material stats due out of Canada to provide the Loonie with direction.

The lack of stats will leave the Loonie in the hands of market risk sentiment and crude oil inventories on the day.

At the time of writing, the Loonie was down by 0.03% to C$1.2524 against the U.S Dollar.

For a look at all of today’s economic events, check out our economic calendar.