The Euro to Australian Dollar (EUR/AUD) exchange rate advanced by around 0.34% on Monday morning.
A group of Eurozone officials will meet later on Monday to attempt to resolve the Greek debt crisis. The shared currency strengthened on Monday morning as a sign that traders are optimistic that the meeting will be successful.
The Australian Dollar, meanwhile, edged lower versus many of its major peers as a result of mixed data. However, rising oil prices have promoted risk appetite which could see the high-yielding ‘Aussie’ (AUD) advance later in the day.
The Euro to Australian Dollar (EUR/AUD) exchange rate is currently trending in the region of 1.4671.
Previously…
At the close of last week, the Euro to Australian Dollar (EUR/AUD) exchange rate was trending within a range of 1.4658 and 1.4783.
With the debt crisis in Greece dominating trader focus, the single currency saw minimal impact from domestic data publications. This is likely to be a theme over the coming week until more progress towards a resolution is made.
A distinct lack of Australian data over the coming week is likely to see ‘Aussie’ (AUD) movement dictated by fluctuations in the commodities market.
Euro (EUR) Exchange Rate Forecast to Fluctuate on Geopolitical Developments
Until it has become clear where Greece stands in the Eurozone, data is unlikely to have a significant influence on single currency movement. With that being said, the German Economic Sentiment Survey is most likely to provoke volatility. Although there are many factors which have the potential to drive economic sentiment down, low oil prices should keep the score relatively high.
In addition to the German economic sentiment data; the German Current Situation Survey, Eurozone Economic Sentiment, Eurozone Consumer Confidence, German Manufacturing/Composite/Services PMIs and Eurozone Manufacturing/Composite and Services PMIs will be of interest to those invested in the single currency.
Australian Dollar (AUD) Exchange Rate Forecast to Soften on Dampened Risk Sentiment
With a distinct lack of domestic data to drive changes, the Australian Dollar will be subject to geopolitical developments and changes in the commodities market. Of particular significance will be oil prices, which have the power to change market sentiment considerably.
Towards the end of last week, oil prices recovered to $60 a barrel for the first time in 2015. Further appreciation is likely to result in increased demand for the South Pacific asset. ‘A continued build in storage will likely further exacerbate near-term price volatility and keep pressing companies to make capital expenditure reduction decisions that will have long-lasting effects on production,’ stated a commodities analyst.
The Conference Board Leading Index and Westpac Leading Index have the greatest potential to drive ‘Aussie’ movement this coming week.
In addition to the Australian data mentioned; New Vehicle Motor Sales, Weekly Consumer Confidence and RBA FX Transactions data have the potential to impact upon ‘Aussie’ movement.
Should market sentiment dampen, there is the potential for ‘Aussie’ gains if traders seek the safe-haven qualities of gold.
Comparison between the performance of the German economy and and other Eurozone countries will be of interest because Greece could use it as fodder for a Grexit if German data continues to outpace that of its surrounding countries.
At the close of last week, the Euro to Australian Dollar (EUR/AUD) exchange rate was trending in the region of 1.4684.
On Sunday the Euro to Australian Dollar (EUR/AUD) exchange rate was trading in the region of 1.4670
