Pound (GBP) Falls as UK Economic Woes Deepen
The Pound (GBP) struggled on Friday as worries about the health of the UK economy continued to trouble GBP investors.
New data showed that company insolvencies leapt 19% year-on-year in August as higher interest rates weigh on British businesses. This added to growing concerns that the UK may soon slip into a recession.
Sterling could be muted today as investors brace for the latest UK consumer price index on Wednesday and the Bank of England (BoE) interest rate decision on Thursday. The latter part of this week’s session could bring significant volatility.
Euro (EUR) Claws Higher amid Dip-Buying
The Euro (EUR) drifted higher on Friday, recouping some of the losses it suffered following the European Central Bank’s (ECB) interest rate decision.
The upside came as investors bought the dip, although the single currency’s gains were severely limited.
Turning to today, two ECB policymakers are scheduled to speak. Any dovish comments could put fresh pressure on the Euro.
US Dollar (USD) Mixed as Market Mood Recovers
The US Dollar (USD) faced mixed conditions on Friday, which led the ‘Greenback’ to trade in a wide range against its peers.
While an improving market mood put some initial pressure on the safe-haven currency, rising US Treasury yields underpinned USD.
Amid a lack of US economic data today, risk appetite could continue to drive the ‘Greenback’. Could an upbeat mood weigh on the American currency?
Canadian Dollar (CAD) Wavers in Tandem with Oil
The Canadian Dollar (CAD) also traded without a clear direction at the end of last week. Volatile oil prices saw the commodity-linked ‘Loonie’ wobble, although it firmed against its weaker peers.
Canadian PPI is in focus today. Could another rise in producer price inflation boost Bank of Canada (BoC) rate hike bets, thereby lifting CAD?
Australian Dollar (AUD) Firms amid Risk-On Mood
The Australian Dollar (AUD) edged slightly higher last night as an improving market mood aided the risk-sensitive ‘Aussie’.
New Zealand Dollar (NZD) Rises despite Weak Data
The New Zealand Dollar (NZD) also enjoyed the improvement in risk appetite, with the ‘Kiwi’ shrugging off a deepening contraction in New Zealand business activity.