Pound (GBP) steady as bond market turbulence eases
The pound (GBP) remained stable yesterday as UK government bond yields continued to pull back from the 27-year highs reached earlier this week.
The calmer atmosphere in bond markets offered reassurance to GBP investors, allowing the currency to edge up against weaker rivals and hold firm elsewhere.
Looking ahead, the pound may see limited momentum today after mixed UK retail sales data. While July’s figures exceeded forecasts at 0.6%, June’s growth was revised down from 0.9% to just 0.3%.
Euro (EUR) subdued after retail sales disappointment
The euro (EUR) slipped yesterday as fresh Eurozone retail sales data revealed a steeper-than-expected decline in July.
Nevertheless, risk aversion across global markets helped the common currency to strengthen against risk-sensitive peers.
Today, however, the euro faces headwinds after Germany posted a striking 2.9% plunge in factory orders, raising concerns about the health of Europe’s largest economy.
US dollar (USD) lifted by cautious mood and upbeat PMI
The US dollar (USD) advanced on Thursday as investors sought the safety of the ‘greenback’ amid widespread market gloom.
Signs of a cooling US labour market briefly dented the dollar in the afternoon, before a stronger-than-anticipated ISM services PMI reading renewed support.
Attention now turns to the all-important US non-farm payrolls release. A weak print could put the dollar under pressure by reinforcing expectations of faster Federal Reserve interest rate cuts.
Canadian dollar (CAD) pressured by oil price decline
The oil-sensitive Canadian dollar (CAD) weakened yesterday as sliding crude prices weighed on the currency.
The focus today will be on Canada’s latest labour market report. Forecasts point to unemployment climbing to 7% in August, matching May’s near four-year high, which could further undermine CAD.
Australian dollar (AUD) gains on brighter risk sentiment
The Australian dollar (AUD) climbed overnight, buoyed by an improvement in global risk appetite that boosted demand for the risk-sensitive ‘Aussie’.
New Zealand dollar (NZD) strengthens amid risk-on mood
The New Zealand dollar (NZD) appreciated overnight as improving risk sentiment lifted demand for the risk-sensitive currency.
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