Pound (GBP) Slumps following Government Borrowing Figures
The Pound (GBP) weakened across the board yesterday as UK government borrowing came in far above forecasts. November borrowing unexpectedly jumped to a record high for the month.
The widening deficit also pointed to a slowdown in government investment, prompting fears about the UK economy’s capacity for growth.
This morning, the UK’s final GDP growth rate for the third quarter of this year was revised lower. This could put pressure on Sterling as the day goes on.
Euro (EUR) Bolstered by Improving German Consumer Confidence
The Euro (EUR) firmed yesterday, as German consumer confidence improved more than forecast.
However, concerns about the Russia-Ukraine conflict limited EUR’s upside following an aggressive speech from Russian President Vladimir Putin.
Data is thin on the ground for the single currency today. With Putin intensifying his rhetoric against Ukraine, could further escalations weigh on the Euro?
US Dollar (USD) Capped as Risk Appetite Fights Positive Consumer Data
Mixed trade struck the safe-haven US Dollar (USD) yesterday as an upbeat market mood capped the upside from strong consumer confidence data.
US consumer confidence for December printed at 108.3, much higher than the expected score of 101, helping the ‘Greenback’ eke out some gains.
This afternoon, the latest initial jobless claims figure is due. If claims remain low, USD could strengthen. In addition, the final GDP growth rate for the third quarter is due out. Any surprises could cause significant movement.
Canadian Dollar (CAD) Rises as Oil Prices Climb
The Canadian Dollar (CAD) strengthened yesterday, with the oil-linked ‘Loonie’ boosted by rising oil prices.
Today, trading conditions are thin. As such, the Canadian Dollar may trade alongside oil price fluctuations. With oil prices turbulent, a fall could dent CAD.
Australian Dollar (AUD) Rallies as China Vows to Boost Growth
The risk-sensitive Australian Dollar (AUD) firmed overnight as risk appetite strengthened across the markets following China’s announcement that stimulus policies were incoming.
New Zealand Dollar (NZD) Strengthens amid Risk-On Trade
The New Zealand Dollar (NZD) also strengthened last night, with the riskier ‘Kiwi’ buoyed by the upbeat market mood.