Pound (GBP) wavers amid market volatility
The Pound (GBP) fluctuated on Friday as the UK currency found itself exposed to market volatility.
The final British manufacturing PMI may have added to the choppy movement. Although it was revised higher, it still pointed to a nineteenth consecutive month of contracting activity.
The focus for the week ahead is Chancellor Jeremy Hunt’s Spring Budget, which he will unveil on Wednesday. The budget could see GBP rise or fall, depending on how it’s received by market participants.
Euro (EUR) gains ground as CPI exceeds expectations
The Euro (EUR) was also choppy on Friday, although it managed to generally trend higher thanks to a hotter-than-forecast consumer price index.
The CPI showed that both headline and core inflation cooled less than expected last month, which tempered bets on a coming interest rate cut from the European Central Bank (ECB).
Today brings a lack of Eurozone economic data, meaning we may see the single currency trade without a clear trajectory.
US Dollar (USD) stumbles on weaker manufacturing PMI
The US Dollar (USD) wavered lower at the end of last week’s session as a weaker-than-forecast manufacturing PMI dented the ‘Greenback’.
The latest ISM survey revealed that US factory activity unexpectedly slipped deeper into contraction territory last month, raising concerns over the health of the American economy.
Looking forward, Federal Reserve official Patrick Harker is due to speak this afternoon. Although he is not voting on policy this year, his comments could still influence USD amid a lack of US data.
Canadian Dollar (CAD) pressured by USD correlation
The Canadian Dollar (CAD) wobbled on Friday, trending lower overall, despite an uptick in oil prices. CAD’s positive correlation with USD seemed to drag on the ‘Loonie’.
With Canadian economic data in short supply today, crude prices could drive CAD exchange rates. Will weaker oil prices see the Canadian Dollar stumble?
Australian Dollar (AUD) weakens as monthly inflation misses forecasts
The Australian Dollar (AUD) softened overnight as Australia’s latest monthly inflation gauge printed at -0.1% and a risk-off mood prevailed. However, stronger-than-expected corporate profits in the fourth quarter of 2023 helped to limit AUD’s losses.
New Zealand Dollar (NZD) slips amid risk aversion
The New Zealand Dollar (NZD) also trended lower last night amid troubling trade data and a bearish market mood.