Pound Sterling (GBP) Exchange Rates Pressured by Renewed Brexit Concerns
The Pound Sterling to Euro (GBP/EUR) exchange rate limped over the finish line on Friday as a renewed focus on Brexit left the currency floundering at the very tail end of the week.
Denmark’s Finance Minister Kristian Jensen put Brexit back in focus on Friday as he warned that time is running out for the UK to strike a deal. He also echoed concerns that there is a strong chance of a ‘no-deal’ Brexit.
In the absence of any major UK data releases this week Brexit is likely to continue to be the main driver behind Sterling, something which could prompt significant losses if headlines remain negative.
GBP/EUR Exchange Rate Slides with Euro Buoyed by USD Weakness
The Pound Euro (GBP/EUR) exchange rate dipped during Friday’s session as the single currency found support from weakness in the US Dollar (USD).
However, somewhat limiting the Euro’s gains was the renewed downturn in the Turkish Lira (TRY), which left a number of EUR investors skittish on ongoing contagion fears.
Today could see the Euro extend its gains, should the Eurozone’s latest construction data reveal output jumped in June as expected.
GBP/USD Exchange Rate Strengthens as US Dollar Weakened by Easing Trade Tensions
The Pound US Dollar (GBP/USD) exchange rate climbed half a cent at the end of last week’s session, holding just above a 14-month low as cooling global trade tensions began to eat into USD demand.
Much of the US Dollar’s recent strength has been derived from appetite for safe-haven assets and the news that the US and China will meet for low-level trade talks this week has seen some of this risk aversion ease.
However, the US Dollar may mount a comeback later this week should some dovish minutes from the Federal Reserve’s latest policy meeting see markets willing to fully price in two more rate hikes this year.
GBP/CAD Exchange Rate Nosedives as Canadian Inflation Skyrockets
The Pound Canadian Dollar (GBP/CAD) exchange rate tumbled by around half a cent on Friday as investors reacted to Canada’s latest Consumer Price Index (CPI).
The CPI figures revealed that domestic inflation took off in July, rocketing up from 2.5% to 3% to strike close to a seven-year high and bolstering speculation that the Bank of Canada (BoC) will continue with its path of monetary tightening.
Looking ahead, a lull in major data releases means that the Canadian Dollar may struggle to repeat this performance during this week’s session.
GBP/AUD Exchange Rate Pressured by Trade Optimism
The Pound Australian Dollar (GBP/AUD) exchange rate fell back late on Friday as the ‘Aussie’ was bolstered by hopes that the US-China talks this week will help to defuse trade tensions between the two sides.
The Australian Dollar may be forced to cede ground overnight on Monday however as the minutes from the Reserve Bank of Australia’s most recent policy meeting are expected to be largely dovish in tone.
GBP/NZD Exchange Rate Slumps as Markets go Risk-On
The Pound New Zealand Dollar (GBP/NZD) exchange rate preformed similarly to GBP/AUD on Friday, with the ‘Kiwi’ climbing as risk sentiment was buoyed by upcoming talks between the US and China.
NZD investors are bracing for a fall in the New Zealand Dollar on Tuesday however, with analysts predicting another drop in prices at the latest Global Dairy Auction.