Pound (GBP) fluctuates lower following borrowing figures
The pound (GBP) ticked lower yesterday, with higher-than-forecast public borrowing fuelling concerns about the possible need for further tax rises in the autumn.
Although the Office for Budget Responsibility (OBR) stated that borrowing was in line with its March forecasts and the outlook for the second half of the year is brighter, Sterling still weakened.
Movement in the pound may be muted today, as GBP investors await some impactful UK data due in the second half of the week.
Euro (EUR) uncertain as trade talks continue
The euro (EUR) traded without a clear direction yesterday amid a lack of Eurozone data and ongoing uncertainty over EU-US trade talks.
Negotiations between Brussels and Washington are ongoing, with no signs of a breakthrough. While the EU has signalled a willingness to agree to an unbalanced deal that favours the US, it is also reportedly considering whether to deploy ‘anti-coercion’ measures in a no-deal scenario.
The Eurozone’s latest consumer confidence report is due out today. However, EUR investors may be reluctant to adjust their positions in the euro, with the European Central Bank (ECB) policy decision due tomorrow.
US dollar (USD) remains muted amid policy concerns
The US dollar (USD) ticked slightly lower yesterday as US policy concerns kept investors wary of the ‘greenback’.
With US President Donald Trump’s tariff deadline looming, and amid his ongoing attempts to pressure Federal Reserve Chair Jerome Powell into cutting interest rates, USD struggled to attract support.
Market-moving US data is in short supply today. Therefore, market risk appetite could influence the safe-haven US dollar.
Canadian dollar (CAD) edges up despite softer oil prices
The crude-linked Canadian dollar (CAD) was unfazed by weakening oil prices yesterday, with the ‘loonie’ able to inch higher against many of its peers.
Canadian data is also thin on the ground today, leaving CAD likely to be driven by oil price dynamics.
Australian dollar (AUD) boosted by trade optimism
The Australian dollar (AUD) strengthened overnight, with hopes for an extension to the US-China tariff deadline and a new US trade deal with Japan both buoying the risk-sensitive ‘Aussie’.
New Zealand dollar (NZD) firms in risk-on trade
The New Zealand dollar (NZD) also rose last night, with the risk-on market mood lifting the ‘kiwi’.
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