Pound (GBP) ticks higher despite lack of data
Despite a lack of fresh UK economic data, the pound (GBP) rose against its weaker rivals yesterday.
The upside in GBP may have been due to a slight pullback in Bank of England (BoE) interest rate cut bets. Signs of stubborn global inflationary pressures could make the BoE think twice about cutting rates in August.
Turning to today, the Confederation of British Industry’s (CBI) latest distributive trades survey could potentially impact GBP. Could slowing retail trade dent the pound?
Euro (EUR) pressured by political worries
The euro (EUR) weakened yesterday as ongoing anxiety over the looming French elections weighed on the common currency.
The polls are showing that Together, the leading centrist coalition, is in third place, behind the far-right National Rally and leftwing alliance New Popular Front. Markets are worried that divisions in France’s National Assembly could lead to political paralysis.
This morning, German consumer confidence showed an unexpected drop heading into July – the first decline in five months. This could pressure EUR today.
US dollar (USD) firms following hawkish Fed comments
The US dollar (USD) gained ground yesterday following hawkish comments from Federal Reserve policymaker Michelle Bowman.
Bowman said that she was open to raising interest rates again if progress on inflation were to ‘stall or even reverse course’. These remarks boosted USD.
US economic data is thin on the ground today, therefore risk appetite could drive USD. Could an upbeat mood undermine the safe-haven ‘greenback’?
Canadian dollar (CAD) boosted by rising inflation
The Canadian dollar (CAD) rose against its weaker rivals yesterday after an unexpected acceleration in Canadian inflation in May dampened Bank of Canada (BoC) rate cut bets.
Amid an absence of Canadian data today, CAD could trade true to its positive correlation with oil prices. An uptick in crude could lift the Canadian dollar.
Australian dollar (AUD) soars as inflation accelerates
The Australian dollar (AUD) skyrocketed last night following hotter-than-forecast Australian inflation. The country’s CPI indicator printed at 4% in May, up from 3.6% in April and above forecasts of 3.8%. This fuelled bets on another rate hike from the Reserve Bank of Australia (RBA).
New Zealand dollar (NZD) wobbles amid unclear trading conditions
The New Zealand dollar (NZD) wavered overnight as a mixed market mood and lack of New Zealand data left the ‘kiwi’ struggling to find a clear direction.