Pound (GBP) drifts in subdued trade
The pound (GBP) lacked direction during yesterday’s session, amid a lack of significant UK economic releases.
This left GBP investors digesting last week’s mixed data, which continued to cast doubt over the UK’s economic trajectory.
Later today, Bank of England (BoE) Chief Economist Huw Pill is set to speak. If he maintains a cautious stance on rate cuts and signals a hawkish outlook, Sterling could find some support.
Euro (EUR) spikes on German election relief
The euro (EUR) got off to a strong start on Monday, lifted by optimism surrounding Germany’s federal election results, with expectations that a stable ‘grand coalition’ could bolster the country’s economic prospects.
However, these gains proved difficult to maintain as the session progressed, particularly after German business sentiment data disappointed.
Looking ahead, a speech by European Central Bank (ECB) policymaker Isabel Schnabel could influence the euro later today, especially if she continues to advocate for tighter monetary policy.
US dollar (USD) struggles amid risk-on mood
The US dollar (USD) started the week on the back foot, as upbeat market sentiment initially dampened demand for the safe-haven currency.
However, the ‘greenback’ later clawed back some losses as fresh geopolitical uncertainties rattled investors.
Today, several Federal Reserve officials are due to speak. A broadly hawkish stance could help the US dollar regain ground.
Canadian dollar (CAD) steady as oil prices hold firm
The Canadian dollar (CAD) saw muted movement on Monday, as a stalling of oil prices left the commodity-linked currency without clear direction.
With no major Canadian data due today, CAD movement is likely to remain tied to crude price fluctuations.
Australian dollar (AUD) fluctuates in choppy trade
The Australian dollar (AUD) strengthened overnight as a weaker US dollar improved risk sentiment, before reversing course as market mood soured heading into the European session.
New Zealand dollar (NZD) weakens as risk appetite fades
The New Zealand dollar (NZD) also saw volatile trade overnight, ultimately retreating as sentiment shifted against risk-sensitive assets.
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