Pound (GBP) crawls higher following recent selloff
The pound (GBP) managed to rise against its weaker rivals yesterday, despite a lack of data, as the UK currency entered oversold conditions.
In addition, speculation that Chancellor Rachel Reeves may change the government’s fiscal rules ahead of the budget later this month seemed to lend GBP support, as the move would allow more headroom to fund investment.
Today, the lack of UK data continues. As a result, Sterling may see muted movement.
Euro (EUR) subdued despite stronger German data
A stronger-than-forecast recovery in German industrial production initially lent the euro (EUR) support yesterday.
However, EUR trimmed its gains against its stronger rivals as the session unfolded. Some dovish comments from European Central Bank (ECB) policymaker Mārtiņš Kazāks weighed on the single currency.
Earlier this morning, Germany’s latest balance of trade showed a widening surplus. This could lend EUR modest support today.
US dollar (USD) buoyed by risk aversion
The safe-haven US dollar (USD) was kept afloat yesterday by an anxious market mood, with USD rising against many of its riskier rivals.
However, a lack of American data and hesitancy ahead of some high-impact events later in the week limited the US dollar’s appeal.
Looking forward, the Federal Reserve’s September meeting minutes are the focus for USD investors this evening. If they reveal that last month’s 50bps cut was likely a one-off, with further easing expected to be more gradual, the US dollar could climb.
Canadian dollar (CAD) falls as oil prices decline
Slumping oil prices pulled the crude-linked Canadian dollar (CAD) lower yesterday, as the recent oil rally came to an end.
Commodity prices could drive CAD movement again today. Will a continued pullback in oil see the ‘loonie’ lose further ground?
Australian dollar (AUD) subdued in absence of data
The Australian dollar (AUD) wavered last night amid a lack of data, with a slight risk-off market mood and pullback in commodities prices seeing AUD soften against stronger rivals.
New Zealand dollar (NZD) slumps as RBNZ cuts rates
The New Zealand dollar (NZD) plunged to multi-month lows last night as the Reserve Bank of New Zealand (RBNZ) cut interest rates by 50bps, and hinted it could follow it up with another bumper cut in November.