Pound (GBP) Slips as Bonds Face Fresh Selling Pressure
The Pound (GBP) stumbled yesterday as an uptick in UK government bond yields unnerved GBP investors following the recent turmoil in bond markets.
Limiting Sterling’s losses, the UK’s final services PMI exceeded previous estimates. The finalised score of 50 meant the UK’s vital services sector narrowly avoided a contraction last month.
With no market-moving UK data releases due out today, domestic news could continue to drive GBP exchange rates. Will the UK’s latest credit outlook downgrade dent the Pound?
Euro (EUR) Falls as Business Activity Contracts
The Euro (EUR) weakened through yesterday’s session after the Eurozone’s final composite PMI came in lower than the preliminary reading, confirming a deepening contraction in the bloc’s private sector.
Adding to EUR’s woes, worries about a possible escalation in the Russia-Ukraine conflict weighed on European markets.
Later this morning, the European Central Bank’s (ECB) meeting accounts could help the single currency regain some ground. Economists expect the minutes to reveal an appetite for further rate rises among ECB policymakers, which may give EUR a lift.
US Dollar (USD) Firms amid Market Caution
The US Dollar (USD) moved higher during yesterday’s session as risk aversion saw traders buy up the safe-haven currency.
However, the ‘Greenback’ trimmed its gains in the afternoon. A better-than-forecast US services PMI cheered global markets, putting some pressure on USD.
The latest initial jobless claims data from America could prompt some USD movement this afternoon. Later on, three speeches from Federal Reserve officials may buoy the US Dollar as policymakers are likely to maintain their hawkish tone.
Canadian Dollar (CAD) Undermined by Trade Data Miss
The crude-linked Canadian Dollar (CAD) struggled to capitalise on a rise in oil prices yesterday as Canada’s balance of trade figures missed forecasts.
Turning to today’s session, will an expected decline in the country’s Ivey PMI see CAD face selling pressure?
Australian Dollar (AUD) Wavers as Trade Balance Disappoints
The Australian Dollar (AUD) wavered in a narrow range overnight, after rising amid yesterday afternoon’s return of risk appetite, as Australia’s latest trade surplus printed lower than forecast.
New Zealand Dollar (NZD) Trims Gains as Risk-On Rally Subsides
The risk-sensitive New Zealand Dollar (NZD) ticked higher in overnight trade as a risk-on mood supported the ‘Kiwi’. However, sentiment then began to sour, paring NZD’s gains.