Pound (GBP) flat amid UK spending review jitters
The pound (GBP) continued to tread water on Monday, with investors hesitant to make any major moves ahead of key UK data releases later this week.
Lingering uncertainty over the government’s forthcoming spending review also contributed to the lacklustre performance in GBP exchange rates.
Sterling came under fresh pressure this morning following the release of underwhelming employment data, with April’s figures showing a rise in unemployment and weaker-than-forecast wage growth. The latest signs of a labour market slowdown will likely increase speculation over Bank of England (BoE) rate cuts.
Euro (EUR) rangebound despite German budget hopes
The euro (EUR) struggled to gain traction at the start of the week, as the single currency was constrained by its negative correlation with a stronger US dollar (USD).
This came in spite of growing hopes that Germany’s upcoming budget announcement will include a fresh round of fiscal stimulus.
With little in the way of high-impact Eurozone releases today, EUR movement is likely to remain closely tied to shifts in USD sentiment.
US dollar (USD) strengthens as trade hopes rise
The US dollar experienced mixed movement on Monday, as investors monitored high-level trade negotiations between the US and China taking place in London.
An initial dip in the dollar was erased later in the session as market optimism grew that the talks could lead to a breakthrough in easing tensions.
If the discussions yield any tangible progress, the ‘greenback’ could continue to firm.
Canadian dollar (CAD) pressured by dip in oil
The Canadian dollar (CAD) faltered at the start of the week, as declining oil prices took the wind out of the commodity-linked currency’s sails.
Should crude continue to weaken today, the ‘loonie’ could remain under pressure.
Australian dollar (AUD) buoyed by improvement in morale
The Australian dollar (AUD) ticked broadly higher overnight on Monday, supported by an improvement in Australian consumer and business confidence.
New Zealand dollar (NZD) wavers in mixed trade
The New Zealand dollar (NZD) treaded water in overnight trade as shifting market risk sentiment infused volatility into the currency.
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