Pound (GBP) choppy following GDP data
The Pound (GBP) faced some volatility at the end of last week, trending broadly lower, following mixed UK GDP data.
Although November’s monthly figure beat forecasts, the three-month average revealed a larger-than-forecast contraction in the UK economy. This stoked recession fears, thereby denting GBP.
Sterling could be quiet today as traders brace for high-impact data later in the week, including the UK jobs report tomorrow and British inflation on Wednesday.
Euro (EUR) stumbles amid lack of data
The Euro (EUR) wavered lower during Friday’s session, as a slight improvement in market mood and lack of Eurozone data left the single currency without support.
Remarks from European Central Bank (ECB) Chief Economist Philip Lane may have cushioned EUR’s losses. Lane reiterated that the bank was not yet considering interest rate cuts.
Today, both Germany’s full-year GDP growth rate and the Eurozone’s latest industrial production report are forecast to show negative results. EUR could face headwinds if they print as expected.
US Dollar (USD) recovers post-PPI loses
The US Dollar (USD) also saw choppy trade on Friday, with an unexpected drop in producer prices in December denting the ‘Greenback’.
However, rising tensions in the Middle East saw the safe-haven US Dollar attract support in the second half of the session, allowing it to regain ground.
Looking ahead, market risk dynamics may drive USD exchange rates today. Could an upbeat mood lead the ‘Greenback’ lower?
Canadian Dollar (CAD) fluctuates in tandem with oil
The crude-linked Canadian Dollar (CAD) initially found success on Friday thanks to an uptick in oil prices. However, prices dropped later in the session, slashing CAD’s gains.
Turning to today, a lack of market-moving Canadian data could leave the ‘Loonie’ to trade on crude prices again. Will we see more volatility?
Australian Dollar (AUD) sheds post-inflation gains
The Australian Dollar (AUD) rose last night after Australian inflation exceeded forecasts, only for AUD to reverse course later in the session as the market mood soured.
New Zealand Dollar (NZD) softens amid souring mood
The New Zealand Dollar (NZD) weakened during overnight trade as a gloomy mood weighed on the risk-sensitive ‘Kiwi’.