Pound (GBP) Bolstered by Strong PMI
The Pound (GBP) firmed at the end of last week’s session, recouping some ground on the back of some robust UK economic data.
The UK’s latest PMI and retail sales figures both surprised to the upside on Friday, with Sterling sentiment particularly cheered by July’s preliminary PMIs as they revealed private sector activity rebounded to a five-year high.
Looking ahead, the absence of any notable data may see the Pound may struggle to find any upward momentum this week, particularly in light of ongoing Brexit uncertainty.
Euro (EUR) Lifted as PMIs Boost Recovery Expectations
The Euro (EUR) was also bolstered at the end of last week as the Eurozone’s own PMI figures also beat expectations in July.
This boosted hopes that the Eurozone will enjoy a strong recovery through the second half of 2020, with the rebound in economic activity providing a strong economic base to work from.
However, the depth of the bloc’s recession remains unclear, which is why this week’s GDP estimate will be closely watched by EUR investors.
US Dollar (USD) Losses Tempered by US-China Tensions
After spending most of last week on the defensive, the US Dollar (USD) finally began to find its feet on Friday, in light of escalating tensions between the US and China.
This also helped to make up for some weaker-than-expected US PMI figures, which revealed the US services sector contracted for the sixth consecutive month in July.
Coming up, the publication of the latest US GDP estimate will be a key focus for USD investors this week. But in the meantime, will another rise in US durable goods orders give the ‘Greenback’ a boost today?
Canadian Dollar (CAD) Slips as Oil Prices Fail to Bounce Back
The Canadian Dollar (CAD) was left on the back foot on Friday, with the commodity-linked ‘Loonie’ struggling to find support as oil prices remained suppressed following Thursday’s selloff.
Australian Dollar (AUD) Gains on RBA Comments
The Australian Dollar (AUD) closed last week’s session under pressure as market sentiment soured slightly on deteriorating US-China relations. In retaliation to being told to close its consulate in Houston, China ordered the US to close its consulate in Chengdu.
The ‘Aussie’ looks as though it may make some gains this morning, however, driven by weakness in the US Dollar and boosted by the Reserve Bank of Australia’s (RBA) Assistant Governor, Christopher Kent, stating optimism over the strength of AUD.
New Zealand Dollar (NZD) Edges Higher on USD Weakness
The New Zealand Dollar (NZD) also reacted to shifting risk appetite at the end of last week, caused by US-China tensions.
The risk-sensitive ‘Kiwi’ is ticking higher this morning, with weakness in the US dollar driving some gains.