Pound (GBP) uncertain following mixed manufacturing PMI
The pound (GBP) moved without a clear direction yesterday following the UK’s final manufacturing PMI for June.
The score was revised lower to show an unexpected slowdown in factory activity last month. However, the PMI also contained positive signs that the sector was continuing to recover.
Turning to today, UK economic data is in short supply. As a result, movement in the pound may be muted.
Euro (EUR) rallies following French election
The euro (EUR) hit multi-week highs yesterday in the wake of the first round of France’s legislative election.
Investors breathed a sigh of relief after the far-right National Rally (RN) party did not perform as well as some polls had predicted, thereby decreasing the likelihood that RN will win an outright majority and be able to pursue its populist fiscal policies unchecked.
The focus for EUR investors in the session ahead will be the Eurozone’s preliminary consumer price index for June. If the CPI shows easing inflationary pressures in the bloc, a rise in European Central Bank (ECB) interest rate cut bets could drive the euro lower.
US dollar (USD) regains ground as sentiment sours
The US dollar (USD) stumbled out of the gate this week as cooling US inflation published on Friday night continued to pressure the ‘greenback’.
In the afternoon, however, the US dollar was able to regain ground as a souring market mood supported the safe-haven currency.
Later today, Federal Reserve Chair Jerome Powell is due to speak. Could hawkish comments lend the US dollar support?
Canadian dollar (CAD) slips amid lack of data
The Canadian dollar (CAD) fell yesterday as a lack of data and muted oil prices left the crude-linked currency vulnerable to losses.
Looking forward, Canada’s June manufacturing PMI is expected to show that domestic factory activity returned to growth last month. Could this lift the ‘loonie’?
Australian dollar (AUD) softens following RBA minutes
The Australian dollar (AUD) was subdued last night, stumbling against its stronger rivals, after the Reserve Bank of Australia’s (RBA) latest meeting minutes revealed concerns about Australia’s economy, thereby dampening rate hike bets.
New Zealand dollar (NZD) slips amid risk aversion
The New Zealand dollar (NZD) fell during the overnight session as a gloomy market mood sapped demand for the risk-sensitive ‘kiwi’.