Pound (GBP) collapses following BoE Bailey comments
The pound (GBP) plunged on Thursday as markets responded to recent comments from Bank of England (BoE) Governor Andrew Bailey.
In an interview with the Guardian, Bailey said the BoE could become a ‘bit more aggressive’ in reducing interest rates. This saw Sterling slump by over 1% against some rivals.
Turning to today, BoE Chief Economist Huw Pill is due to speak this morning. Could any more comments on policy drive further volatility in the pound?
Euro (EUR) climbs as Eurozone data beats forecasts
The euro (EUR) recovered some of its recent losses yesterday thanks to stronger-than-expected Eurozone economic data.
The bloc’s final services PMI for September was revised higher, coming in at 51.4 rather than 50.5. Meanwhile, Eurozone producer prices grew 0.6% in August, beating forecasts of 0.3% growth and slightly dampening European Central Bank (ECB) rate cut bets.
Later this morning ECB Vice-President Luis de Guindos will deliver a speech. If he once again highlights the downside risks to the Eurozone economy then EUR could stumble.
US dollar (USD) rallies as Fed rate cut bets recede
The US dollar (USD) enjoyed support yesterday as a risk-off market mood and dwindling bets on another 50bps cut from the Federal Reserve boosted USD’s appeal.
A far better-than-forecast ISM services PMI for September kept the ‘greenback’ afloat in the afternoon, with the US services sector unexpectedly seeing its strongest growth since February 2023.
Today, the latest non-farm payrolls report takes centre stage. Could a surprisingly robust reading see USD soar?
Canadian dollar (CAD) rises alongside oil
The crude-linked Canadian dollar (CAD) firmed yesterday as rising oil prices continued to boost demand for the currency.
In the absence of any Canadian data today, crude prices could drive CAD movement once again. If oil extends its upside, so could CAD.
Australian dollar (AUD) subdued amid mixed market mood
The Australian dollar (AUD) was muted overnight as a lack of domestic data and uncertain market mood left the ‘Aussie’ without a clear direction.
New Zealand dollar (NZD) inches lower in absence of data
The New Zealand dollar (NZD) softened during last night’s session as the absence of any New Zealand data left the ‘kiwi’ exposed to losses.