Pound (GBP) steady as UK services PMI revised up
The pound (GBP) remained rangebound yesterday, supported by an upward revision to the UK’s services PMI, which confirmed the private sector avoided contraction last month.
However, Sterling’s gains were capped after Bank of England (BoE) Governor Andrew Bailey predicted up to four UK rate cuts in 2025 as inflationary pressures ease.
Today, a speech by UK Prime Minister Keir Starmer will be in focus for GBP investors. Starmer is expected to unveil the government’s ‘plan for change’, including housebuilding and planning reforms aimed at boosting economic growth.
Euro (EUR) softens on dovish ECB signals
The euro (EUR) struggled on Wednesday following dovish remarks from European Central Bank (ECB) policymaker Olli Rehn.
Rehn suggested there is ‘justification for a December rate cut’ and hinted that further policy easing could follow in 2024.
Later this morning, the Eurozone will release its latest retail sales report. Another decline in sales during October could weigh on the euro.
US dollar (USD) dips on weak economic data
The US dollar (USD) faced headwinds on Wednesday after a run of disappointing US economic data.
November’s ISM services PMI showed a sharper-than-expected slowdown in the service sector, while ADP employment figures undershot forecasts.
Looking ahead, USD investors will turn their attention to the latest initial jobless claims. A positive print could help the ‘greenback’ recover if it highlights resilience in the US labour market.
Canadian dollar (CAD) slips as oil prices fall
The Canadian dollar (CAD) weakened yesterday, with falling oil prices undermining demand for the commodity-linked currency.
If crude oil prices remain under pressure today, the ‘loonie’ could extend its recent losses.
Australian dollar (AUD) climbs on upbeat trade data
The Australian dollar (AUD) rebounded overnight, recovering from a one-year low as Australia’s trade surplus unexpectedly widened, thanks to a surge in exports.
New Zealand dollar (NZD) edges higher on improving sentiment
The New Zealand dollar (NZD) also saw modest gains overnight, benefiting from cautious optimism and improving global risk appetite.
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