The Canadian, Australian and New Zealand dollars strengthened against the greenback but their rallies are unconvincing.
All of the three currencies failed to rally above its high on Friday and could now be vulnerable to more losses given the afternoon sell-off in US stocks. The main reason why commodity currencies rallied today is the move in oil and gold, which have continued to edge higher. The New Zealand trade balance is due for release this evening along with Money Supply. The market expects the trade surplus to increase given the rise in commodity prices but the risk is to the downside given the drop in New Zealand PMI. Australia on the other hand will be reporting business confidence and new home sales, both of which could reflect slowing growth. There are no releases expected from Canada.
