Pound Climbs over 1% against the Euro and US Dollar

Pound Soars as SNP Fails to Secure a Majority

The Pound (GBP) surged over 1% against the Euro and US Dollar at the start of this week, as GBP investors were relieved that the Scottish National Party (SNP) failed to secure an outright majority in last week’s elections.

This weakens the SNP’s mandate to hold another independence referendum and cleared some of the recent political uncertainty which has supressed Sterling.

These gains were then reinforced as Boris Johnson confirmed more of the UK economy would reopen from 17 May.

Meanwhile, GBP investors will look to a speech by Bank of England (BoE) Governor Andrew Bailey later this afternoon for fresh impetus.

Euro Muted amid ECB Policy Confusion

The Euro (EUR) was subdued on Monday following uncertainty over the European Central Bank’s (ECB) future policy plans.

This arose from comments from ECB policymakers on whether or not the bank may begin to taper its bond purchases next month or allow inflation to run above target for a period.

In the spotlight today will be the latest ZEW survey’s, with the Euro potentially facing some headwinds if economic sentiment in Germany deteriorates again this month.

US Dollar Continues to Weaken on Abysmal Payroll Figures

The US Dollar (USD) remained on the defensive at the start of this week’s session, as the currency continued to suffer as a consequence of Friday’s dire payroll print.

Further undermining the safe-haven ‘Greenback’ on Monday was a prevailing risk-on mood and dovish Federal Reserve interest rate expectations.

Looking ahead, the focus for USD investors today will be the latest JOLTs job openings report. Will a further increase in the number of job vacancies offer some support to the US Dollar later this afternoon?

Canadian Dollar Muted as Oil Prices Fall

The Canadian Dollar (CAD) was subdued on Monday as the appeal of the commodity-linked ‘Loonie’ was undermined after WTI oil prices slipped below $65 a barrel.

Australian Dollar Stumbles as Market Sentiment Sours

The Australian Dollar (AUD) was placed on the defensive overnight on Monday, with investors shying away from the risk-sensitive ‘Aussie’ as they were spooked by a selloff in equity markets.

New Zealand Dollar Dented by Risk-Off Trade

The New Zealand Dollar (NZD) also struggled to attract support during today’s Asian trading session, amidst a souring of market sentiment.

Data Releases

10:00 EUR ZEW Economic Sentiment (May)

15:00 USD JOLTs Job Openings (Mar)

15:30 GBP BoE Bailey Speech