Pound (GBP) boosted by stronger GDP
The pound (GBP) strengthened yesterday after the UK’s latest GDP data beat expectations.
The British economy returned to growth in May, printing at 0.4% and exceeding forecasts of 0.2%. This upbeat data boosted the pound.
Turning to today, UK data has thinned out. As a result, Sterling may end the week muted.
Euro (EUR) pressured by cooling German inflation
The euro (EUR) came under some pressure yesterday after Germany’s final consumer price index for June confirmed a cooldown in inflation in the Eurozone’s largest economy.
However, EUR’s strong negative correlation with the slumping US dollar (USD) provided the common currency with support and spared it from steeper losses.
Market-moving Eurozone data is in short supply today, which could leave the euro struggling to find a clear direction once again.
US dollar (USD) plummets as CPI misses forecasts
The US dollar slumped yesterday after the US CPI figures for June showed a larger-than-forecast cooldown in inflation.
Both headline and core inflation eased, coming in lower than expected, with the former dropping to a one-year low. This fuelled bets on a September interest rate cut from the Federal Reserve, with market odds leaping from below 70% to almost 85%.
Today, two mid-tier US data releases are due out. Could a slight increase in producer prices in June and rising consumer sentiment in July be enough to lift USD?
Canadian dollar (CAD) slides on USD correlation
The Canadian dollar (CAD) fell yesterday as CAD was dragged lower due to its positive correlation with the tumbling US dollar.
Looking ahead, could an uptick in oil prices help the crude-linked ‘loonie’ regain ground?
Australian dollar (AUD) rangebound despite risk-positive mood
The Australian dollar (AUD) wavered overnight as the ‘Aussie’ struggled to attract support despite a positive market mood.
New Zealand dollar (NZD) underpinned by risk-on trade
The New Zealand dollar (NZD) also wobbled last night. A weaker manufacturing PMI initially dented NZD before a risk-on mood helped the currency recover.