Pound (GBP) Exchange Rates Muted as Chancellor Refuses to Extend Furlough Scheme
The Pound (GBP) struggled to find momentum at the end of last week’s session after Chancellor Rishi Sunak signaled that there would not be an extension to the government’s furlough scheme.
Sterling sentiment soured on the comments amid concerns this will lead to an unemployment crisis when the scheme expires in October, particularly in those industries hardest hit by the coronavirus pandemic.
Turning to these week’s session, the Pound looks set to face considerable resistance as the UK’s latest GDP figures are expected to report a startling plunge in economic growth in the second quarter.
Euro (EUR) Slips against the Pound on USD Strength
Euro (EUR) exchange rates dipped on Friday as the single currency’s negative correlation with the US Dollar (USD) saw it lose out in the dash to USD.
This slide in the Euro also came despite German industrial production printing higher than expected in June.
Coming up this week, the latest ZEW economic surveys will be in the spotlight for EUR investors. Will sentiment have continued to improve this month, or will a more cautious outlook dent the Euro?
US Dollar (USD) Rallies against Euro and GBP on Market Jitters
The US Dollar (USD) closed last week’s session on a high, with skittish investors flocking to the safe-haven currency as Trump stoked US-China tensions by signing an executive order banning two massively popular Chinese apps.
This sentiment was then turbocharged on reports the White House is considering sanctioning Hong Kong leader Carrie Lam.
However, the latest US non-farm payroll release capped the upside in the ‘Greenback’. While beating expectations, analysts warned the report points to a deceleration in employment growth.
Looking ahead to the start of this week, we may see the US Dollar give up some ground this afternoon amidst forecasts July’s JOLTs figures will report US job openings fell.
Canadian Dollar (CAD) Buoyed by Stronger-than-Expected Employment Report
The Canadian Dollar (CAD) ticked higher on Friday, strengthening on the back of Canada’s job report as it revealed a slightly larger-than-expected fall in domestic unemployment last month.
Australian Dollar (AUD) Muted in Risk-Off Trade as USD Strengthens
After tumbling on Friday, the Australian Dollar (AUD) opened this week nursing its losses as demand for the risk-sensitive ‘Aussie’ remained weaker amidst concerns US-China tensions concerns.
New Zealand Dollar (NZD) Stuck in Bottom Gear
The New Zealand Dollar (NZD) also struggled to find any momentum in early trade this week, with the ‘Kiwi’ undermined by a slump in domestic business confidence in August.