Pound (GBP) stable amid budget hopes
The pound (GBP) edged higher at the end of last week’s session as recent jitters over the UK’s looming Autumn Budget appeared to dissipate.
Having won the backing of banking giants Lloyds and Barclays, it appears that concerns that Chancellor Rachel Reeves could cause a ‘mini-budget’ style meltdown have almost entirely evaporated.
The Confederation of British Industry will publish its latest distributive trades index later this morning. However, its impact on the pound may be negligible as GBP investors err on the side of caution ahead of Wednesday’s budget announcement.
Euro (EUR) muted amid ECB rate cut bets
The euro (EUR) was mostly rangebound at the end of last week, amid growing European Central Bank (ECB) interest rate cut expectations.
Following on from Thursday’s lacklustre Eurozone PMIs, EUR investors are growing increasingly confident the ECB will cut rates again when it next meets in December.
EUR data is in short supply at the start of this week, which may leave the euro to trade without direction through today’s session.
US dollar (USD) stumbles on weak data
The US dollar (USD) closed last week’s session on the back foot, following the publication of the latest US durable goods orders data.
These reported that goods orders shrank by 0.8% in September. While this was slightly ahead of the 1% contraction forecast, order growth in August was also revised down from 0% to -0.8%.
Looking ahead, movement in the US dollar may be limited today as USD investors brace for several high-impact US data releases later in the week.
Canadian dollar (CAD) falls in tandem with USD
The Canadian dollar (CAD) fell at the end of last week’s session, as the currency’s positive correlation with the US dollar dragged on the ‘loonie’.
This morning, Bank of Canada (BoC) Governor Tiff Macklem is due to speak. Could dovish comments in the wake of last week’s 50bps rate cut see CAD slide?
Australian dollar (AUD) dented by falling commodities
The Australian dollar (AUD) weakened overnight, hitting multi-week lows, as falling commodities prices dragged on the ‘Aussie’.
New Zealand dollar (NZD) slides as resource prices weaken
Likewise, the New Zealand dollar (NZD) slid to multi-month lows last night as losses in the commodities market and a stronger US dollar pressured the ‘kiwi’.