Pound Steadies Following BoE Surge
The Pound (GBP) remained mostly rangebound through the end of last week’s session, lacking any follow through in the wake of its Bank of England (BoE) driven rally on Thursday.
While the UK’s vaccination success remained supportive to Sterling, the ongoing uncertainty over the current national lockdown limited any upward momentum in the currency.
In the spotlight for GBP investors this week will be the UK’s latest GDP figures, where a likely slump in economic growth in the last quarter of 2020 is likely to put some pressure on the Pound later in the session.
Euro Rebounds on USD Weakness
After slumping throughout much of the week, the Euro (EUR) was finally offered some respite on Friday as its negative correlation with the US Dollar (USD) allowed it to recoup some ground.
However, these gains remained limited in light of Germany’s latest factory order figures, where a surprisingly large slump in growth spooked investors given how vital the manufacturing sector has been to the country’s economic recovery.
Kicking off this week’s session was the publication of Germany’s latest industrial production figures, where a stalling of output in December could leave the Euro on the back foot this morning.
US Dollar Retreats as Payrolls Disappoint
The US Dollar’s recent bullish run came to an abrupt halt at the end of last week’s session following the publication of the latest US non-farm payrolls.
These showed that the US economy only added 49,000 jobs in January, which alongside a downgrade to December’s figures, stoked concerns over the US labour market and undermined some of the recent optimism regarding the US economic recovery.
Coming up this week, the focus for USD investors will be on the latest US consumer price index. Will another acceleration in domestic inflation support USD exchange rates?
Canadian Dollar Steady as Strong Oil Prices Offset Rise in Unemployment
The Canadian Dollar (CAD) traded in a narrow range on Friday, as Canada’s weaker-than-expected labour report was offset by a robust commodity market, which saw WTI crude propelled to a new one-year high.
Australian Dollar Struggles Despite Upbeat Market Mood
The Australian Dollar (AUD) struggled for direction overnight as support from an upbeat market mood was offset by the US Dollar strengthening on the back of a rise in US bond yields.
New Zealand Dollar Directionless on Bank Holiday
The New Zealand Dollar (NZD) was also subdued at the start of the week as New Zealand markets closed for a national holiday.