Pound (GBP) Gains as PMI Beats Forecasts
The Pound (GBP) firmed against many of its rivals on Friday, despite concerns that the supply chain crisis could cause further disruption in the coming months.
The upside came as the UK’s final manufacturing PMI was revised slightly higher, printing at 57.1 versus the 56.3 that was forecast.
With no key UK data out today, GBP exchange rates could be primarily influenced by domestic news.
Euro (EUR) Dented by Inflation Fears
The Euro (EUR) slipped against most of its peers through Friday’s session as Eurozone inflation soared to a 13-year high of 3.4%. With the European Central Bank (ECB) maintaining its dovish stance, many investors are fearful of a policy misstep.
The single currency was also pressured after the finalised manufacturing PMIs missed expectations, and dropped notably from August’s reading.
In the absence of any major market-moving data today, EUR could be vulnerable to losses.
US Dollar (USD) Dips amid Risk-On Trade
The US Dollar (USD) softened at the end of last week, with the safe-haven currency losing appeal amid a bullish market sentiment.
Some positive data from the US, including the ISM manufacturing PMI and personal income and spending, added to the upbeat mood and therefore did nothing to support the ‘Greenback’.
Looking ahead, US factory orders for August are expected to rise from 0.4% to 1%, which could boost USD.
Canadian Dollar (CAD) Mixed as Oil Fluctuates
The commodity-linked Canadian Dollar (CAD) had a mixed session on Friday as oil prices experienced some volatility.
CAD was also affected by above-forecast results in its manufacturing PMI and GDP, although the GDP reading still showed a small contraction for July.
With no notable Canadian data on the calendar today, oil prices could be the main driver of CAD exchange rates.
Australian Dollar (AUD) Ticks Lower amid Political Disruption
The Australian Dollar (AUD) wavered overnight, trending downwards overall, amid a rise in Covid cases and domestic political turmoil.
John Barilaro, the deputy premier of New South Wales, resigned overnight. His departure comes after the state premier Gladys Berejiklian quit last week amid a corruption investigation.
New Zealand Dollar (NZD) Subdued on AUD Weakness
The New Zealand Dollar (NZD) also softened somewhat in overnight trade, dented by its positive correlation to AUD.