Pound (GBP) Exchange Rates Undermined by London Lockdown Concerns
There was plenty of exchange rate news to focus on at the start of the week. For starters, the Pound (GBP) was on the defensive yesterday amid speculation London could be put into lockdown as part of the UK government’s plans to halt the spread of a second wave of coronavirus.
Further limiting the appeal of Sterling was the UK’s latest manufacturing PMI, with July’s final reading revealing UK factory activity rebounded at a slightly slower pace than initially expected last month.
Turning to today’s session, there may be little in the way of exchange rate news for the Pound in the absence of any notable UK data, especially if GBP investors turn their focus back to Brexit.
Euro (EUR) Subdued as Eurozone GDP Figures Weigh
The Euro (EUR) was mostly rangebound through Monday’s trading session as the appeal of the single currency remained limited in the wake of last week’s Eurozone GDP figures.
However, the Euro was able to avoid any notable losses in light of the Eurozone’s latest manufacturing PMI, which was revised higher in July’s final release.
The publication of the Eurozone’s latest produce price index (PPI) could offer the Euro some limited support this morning if prices began to accelerate again in June as forecast.
US Dollar Exchange Rate News: USD Mounts a Comeback
After some relentless selling pushed it into oversold territory last week, the US Dollar (USD) opened this week’s session on a stronger footing as investors sought to capitilise on the undervalued ‘Greenback’.
This upswing in USD was supported by the latest ISM manufacturing PMI, which soared to a 16-month high in July amid a stronger-than-expected rebound in US factory activity.
This afternoon’s US factory order figures could be today’s main contributor to exchange rate news. Will another solid rise in order growth help bolster the US Dollar?
Canadian Dollar (CAD) Steady as Oil Prices Recover
The Canadian Dollar (CAD) ticked higher on Monday, with the oil-linked ‘Loonie’ finding support as WTI crude prices crept higher again at the start of the session.
RBA Leaves Rates on Hold, Limited Impact on Australian Dollar Exchange Rate News
The Australian Dollar (AUD) trended higher overnight on Monday following the Reserve Bank of Australia’s (RBA) latest rate decision.
As expected, the RBA opted to maintain the status quo this month, and despite concerns policymakers might comment on the speed of the ‘Aussie’s recent appreciation, the issue was not raised.
New Zealand Dollar (NZD) Steady amid Coronavirus Concerns
The New Zealand Dollar (NZD) was stuck in a narrow range overnight as NZD investors remain wary of Australia’s recent coronavirus resurgence and its potential impact on demand for NZ exports.
Coming up later this evening, we could see the ‘Kiwi’ dive as New Zealand’s latest employment figures are expected to report a sharp rise in the unemployment rate in the second quarter.