Pound (GBP) Firms on BoE Tailwind
The Pound (GBP) firmed against many of its major rivals on Friday, as Sterling enjoyed a modest tailwind following the Bank of England’s interest rate decision on Thursday.
However, a lack of notable data releases and a slight increase in UK Covid cases limited the Pound’s upside.
With no data due from the UK today, GBP could find itself open to losses. Business and coronavirus headlines may drive most movement in the Pound.
Euro (EUR) Slips on Poor German Data
The Euro (EUR) weakened at the end of last week’s session, as Germany’s industrial production figures unexpectedly contracted by 1.3% in June.
Further headwinds hit the single currency in the afternoon when the US Dollar (USD) rallied, with the EUR/USD negative correlation weighing on the Euro.
Turning to today, EUR investors seem unimpressed with Germany’s latest balance of trade figures this morning. The data showed a widening trade surplus but missed forecasts by €0.5bn, and the Euro is currently subdued.
US Dollar (USD) Surges on Non-Farm Payrolls
The US Dollar (USD) soared on Friday afternoon as the US non-farm payrolls figures and unemployment rate both beat expectations.
The US economy added 943,000 jobs in July, the highest number in 11 months and above forecasts of 870,000. Meanwhile, the unemployment rate dropped to 5.4%, exceeding expectations of 5.7%.
The strong jobs figures were seen as bolstering the chances of the Federal Reserve beginning its tapering process by the end of the year, which prompted a sharp uptick in the US Dollar.
The JOLTs job openings report this afternoon could give USD another boost if it also suggests that the US economy and labour market are recovering strongly.
Canadian Dollar (CAD) Muted as Data Misses Expectations
The Canadian Dollar (CAD) was subdued on Friday, as Canadian employment data missed expectations and falling oil prices weighed on the commodity-linked ‘Loonie’.
In the absence of data today, oil prices could be the primary influence on CAD exchange rates. Will they continue to fall or will they rally as the day goes on?
Australian Dollar (AUD) Undermined by Covid Outbreaks
The Australian Dollar (AUD) slumped and then recovered overnight, trading sideways overall as Australia’s Covid situation continues to undermine the ‘Aussie’.
New Zealand Dollar (NZD) Gains on Upbeat Market Mood
The New Zealand Dollar (NZD) ticked higher overnight, supported by a riskier market mood and China’s above-expected inflation rate.