Pound (GBP) Stumbles on Latest Fishing Rights Setback
The Pound (GBP) was on the back foot again yesterday as hopes for a Brexit deal were once again dashed.
The latest setback came as EU members reportedly rejected a compromise offered by Boris Johnson in regard to fishing rights.
Offering some limited support to Sterling, however, was the UK’s latest GDP figures as growth was revised higher in the final third quarter estimate.
Looking ahead, it seems safe to assume that with Brexit and coronavirus concerns still front and centre, any upside in the Pound is likely to remain limited today.
Euro (EUR) Fluctuates as Mutated Covid-19 Detected in Europe
Trade in the Euro (EUR) was mixed again on Tuesday, with the single currency struggling against the US Dollar (USD) following the news that the coronavirus mutation from the UK had already made its way across the Channel.
However, confidence that the vaccines currently rolling out across the world will protect against the new variant ensured losses were minimised.
In the continued absence of any notable Eurozone data releases this week, EUR investors will be keeping a close eye on coronavirus developments for any signs the new strain is starting to be detected in any real numbers on the continent.
US Dollar (USD) Bolstered by Market Anxiety
The US Dollar (USD) moved broadly higher through yesterday’s trading session, with demand for the safe-haven currency remaining robust amidst ongoing jitters over the new strain of Covid-19.
Further underpinning the ‘Greenback’ was a stronger-than-expected US GDP print, with growth in the third quarter revised to 33.4%, up from the previous estimate of 33.1%.
In the spotlight for USD investors today we have the publication of the latest US durable goods orders release, where a fall in order growth last month could potentially weaken the US Dollar.
Canadian Dollar (CAD) Dips as Oil Slump Continues
The Canadian Dollar (CAD) remained on the defensive on Tuesday, as demand for the commodity-linked ‘Loonie’ continued to be undermined by a pullback in oil prices.
Coming up, we may see the publication of Canada’s latest monthly GDP release further dampen the appeal of the Canadian Dollar later this afternoon, amid forecasts domestic growth will have slowed again in October.
Australian Dollar (AUD) Rallies amid USD Weakness
The Australian Dollar (AUD) struck higher overnight on Tuesday as a sudden drop in the US Dollar bolstered the appeal of the risk-sensitive currency.
New Zealand Dollar (NZD) Buoyed Despite Market Uncertainty
The New Zealand Dollar (NZD) also trended higher in overnight trade, with the ‘Kiwi’ able to strengthen on the back of the broad USD weakness in spite of a generally cautious market mood.