Pound (GBP) dented by downbeat retail data
The pound (GBP) slipped against its stronger peers on Friday following a much larger-than-forecast contraction in UK retail sales growth last month.
However, while UK sales slumped 1.2% in June, economists said the decline was largely due to pre-election jitters and unseasonably wet weather. This limited GBP’s losses.
Turning to the upcoming session, Sterling may have a muted start to the week amid an initial lack of UK economic releases.
Euro (EUR) firms amid risk-off mood
The euro (EUR) managed to firm against its riskier rivals on Friday as a gloomy market mood saw investors favour the safer single currency.
EUR was also able to regain some of the ground it lost in the wake of the European Central Bank’s (ECB) interest rate decision on Thursday, as it seems markets may have overreacted to ECB President Christine Lagarde’s lukewarm commentary.
Today, Eurozone economic data is in short supply. Therefore, the euro could trade without a clear direction.
US dollar (USD) regains more ground on Fed comments
The US dollar (USD) extended its end-of-week recovery on Friday after Federal Reserve policymaker Mary Daly said it was ‘a risk to act too soon’ and start lowering interest rates.
In addition, rising US Treasury bond yields and market risk aversion both also boosted the safe-haven ‘greenback’.
US political uncertainty could inject some volatility into the US dollar today, after President Joe Biden withdrew from the 2024 presidential race.
Canadian dollar (CAD) slips amid falling retail sales
After initially firming on Friday, the Canadian dollar (CAD) then slipped as Canadian retail sales contracted more than expected in May.
Today, a lack of Canadian data may leave the crude-linked ‘loonie’ to trade on oil prices. Could oil volatility see CAD fluctuate?
Australian dollar (AUD) weakens as market mood sours
The Australian dollar (AUD) fell as this week’s session began, with a souring market sentiment sapping support for the risk-sensitive ‘Aussie’.
New Zealand dollar (NZD) undermined by risk aversion
The downbeat mood also dented the New Zealand dollar (NZD), offsetting an unexpected expansion in New Zealand’s trade surplus for June.