Pound (GBP) Slips, Doubts Cast on Brexit Deal
The Pound (GBP) tested a fresh multi-month high at the end of last week before crashing back down to earth as hopes of the UK striking a Brexit deal with the EU began to fade again.
Following a meeting between UK Brexit Secretary Stephen Barclay and EU Chief Negotiator Michel Barnier, political commentators suggested the UK and EU remain as ‘far as ever’ from a deal.
A lack of impactful economic data will likely leave Brexit in focus this week, potentially infusing fresh volatility into Sterling throughout the session.
GBP/EUR Exchange Rate Muted as Eurozone Consumer Sentiment Improves
The Pound Euro (GBP/EUR) exchange rate was left muted at the end of last week’s session, with the pairing edging back from a three-month high following a modest uptick in Eurozone household sentiment.
The European Commission reported its consumer confidence index ticked up to -6.5 in September, still deep in negative territory but beating market expectations for a reading of -7.
Coming up this morning the Eurozone’s latest PMI figures could influence EUR exchange rates. The Euro could retreat if growth in the bloc’s private sector slowed this month.
GBP/USD Exchange Rate Slumps on Safe-Haven Demand
The Pound to US Dollar (GBP/USD) exchange rate fell around half a cent from its best levels on Friday as the ‘Greenback’ soared on the back of renewed safe-haven demand.
Fresh concerns over slowing global growth unnerved investors at the end of last week, causing many to seek shelter in the US Dollar.
Looking to the week ahead, we may see USD exchange rates come under fire if an expected contraction in US durable goods orders reignites fears that a US recession may be looming.
GBP/CAD Exchange Rate Steady as Canadian Retail Sales Disappoint
The Pound to Canadian Dollar (GBP/CAD) exchange rate traded in a narrow range on Friday, with the ‘Loonie’ unable to press its advantage after a disappointing retail sales print.
Sales growth fell short of expectations in July, accelerating by 0.4% against forecasts of a 0.6% rise, while Statistics Canada also revised June’s reading down from 0% to -0.1%.
GBP/AUD Exchange Rate
The Pound to Australian Dollar (GBP/AUD) exchange rate declined overnight as Australia’s services PMI improved. The index came in at 52.5 in September, up from a previous reading of 49.1.
Although the nation’s manufacturing index dipped below the 50 mark separating growth from contraction, the impressive services performance helped the composite index rise to 51.9.
GBP/NZD Exchange Rate
The Pound to New Zealand Dollar (GBP/NZD) exchange rate dropped 0.4% as European markets opened. High profile data for New Zealand is lacking until tomorrow when the nation’s trade balance stats will be released. A widening trade deficit would be NZD-negative.