Pound (GBP) buoyed by UK election result
The pound (GBP) enjoyed modest success on Friday after the Labour Party won a landslide in the UK general election.
Investors welcomed the election results. However as a Labour victory was already priced in, Sterling’s movement was limited.
Turning to today, UK economic data is in short supply. As a result, movement in the pound may be muted.
Euro (EUR) undermined by downbeat data
The euro (EUR) was mixed as last week’s session drew to a close, with falling German industrial production and weaker Eurozone retail sales putting some pressure on the currency.
However, EUR was cushioned by its strong negative correlation with a weakening US dollar (USD).
The euro could enjoy modest support today after the far-right National Rally (RN) party failed to win a majority in the French election, with the second round resulting in a hung parliament.
US dollar (USD) struggles amid falling Treasury yields
The US dollar touched multi-week lows on Friday as falling US Treasury yields pressured the ‘greenback’.
A mixed non-farm payrolls report also subdued USD. While June’s figure exceeded expectations, a sharp downward revision to May’s results offset any upside potential.
US economic data is absent from the calendar today. Therefore, risk appetite could drive the safe-haven US dollar. Will a risk-off mood boost the ‘greenback’?
Canadian dollar (CAD) slides amid rising unemployment
The Canadian dollar (CAD) fell sharply on Friday following a jump in Canadian unemployment in June. Canada’s jobless rate rose from 6.2% to 6.4%, higher than the expected 6.3%.
With Canadian data thin on the ground today, the crude-linked ‘loonie’ could trade in line with oil prices. With prices falling this morning, CAD could face headwinds.
Australian dollar (AUD) underpinned by RBA bets
The Australian dollar (AUD) held firm overnight, despite a gloomy mood and lower commodities prices, as bets on another interest rate hike from the Reserve Bank of Australia (RBA) underpinned the ‘Aussie’.
New Zealand dollar (NZD) buoyed by AUD correlation
The New Zealand dollar (NZD) wavered overnight as NZD drew support from its positive correlation with AUD.