Pound (GBP) Subdued following UK GDP Slowdown
The Pound (GBP) was fairly muted through Friday’s session after the UK’s latest GDP report showed that growth slowed to just 0.1% in October.
However, GBP showed surprising resilience, managing to trade sideways and even firm against some of its rivals.
With UK data thin on the ground today, UK Covid news may weigh on GBP. Cases in the UK are rising rapidly, prompting talk of further restrictions to prevent the virus overwhelming the NHS.
Euro (EUR) Mixed on Inflation Rate Readings
The Euro (EUR) was mixed at the end of last week’s session, initially slipping as Germany’s inflation rate failed to cheer EUR investors.
The single currency regained some ground in the afternoon, however, benefitting from its strong negative correlation to a weakening US Dollar (USD) following the US CPI.
In the absence of any market-moving Eurozone data today, EUR may struggle to find a clear direction.
US Dollar (USD) Tumbles after CPI Release
The US Dollar (USD) fell sharply on Friday afternoon, despite the US inflation rate hitting a 39-year high of 6.8%.
The downside seemed to come from some profit-taking as investors sought to cash in on the hawkishly priced ‘Greenback’.
Risk appetite could be the primary driver of USD movement today. With Omicron now spreading rapidly, the market mood may sour, thereby boosting the safe-haven USD.
Canadian Dollar (CAD) Stumbles as Oil Prices Dip
The Canadian Dollar (CAD) slipped on Friday afternoon as a dip in oil prices impacted the appeal of the commodity-linked ‘Loonie’.
Looking ahead, movements in the oil market may continue to influence CAD today amid a lack of Canadian data.
Australian Dollar (AUD) Ticks Lower as Risk Appetite Wanes
The Australian Dollar (AUD) softened in overnight trade as risk appetite faded, with the prospect of an accelerated taper from the Federal Reserve and the spread of Omicron weighing on markets.
New Zealand Dollar (NZD) Rangebound on Services PMI
The New Zealand Dollar (NZD) was fairly flat overnight as a risk-off market mood offset New Zealand’s better-than-expected services PMI.