Pound (GBP) subdued after uneven retail sales
The pound (GBP) traded without much momentum on Friday, as UK retail sales data from the Office for National Statistics (ONS) delivered a mixed picture.
Although July’s sales rose by 0.6%, beating forecasts, revisions to earlier figures raised questions over the reliability of ONS reporting and renewed worries about the UK’s broader economic outlook.
With no major UK data at the start of this week, Sterling is likely to remain driven by global market sentiment.
Euro (EUR) pressured by weak German factory data
The euro (EUR) faced some pressure at the end of last week after Germany’s latest factory orders revealed a steep 2.9% fall in July.
Even so, losses for the single currency proved limited, partly cushioned by its negative correlation with the US dollar (USD).
Germany’s latest industrial production release this morning may influence EUR movement, with signs of a rebound in output potentially offering modest support.
US dollar (USD) sinks after dire payroll numbers
The US dollar (USD) tumbled on Friday as markets reacted to a dismal US employment report.
Non-farm payrolls showed just 22,000 new jobs added in August, fuelling speculation the Federal Reserve could cut rates by as much as 75 basis points before the year is out.
With few fresh US releases on the calendar, the dollar may remain under pressure today as investors continue to digest Friday’s data and reprice Fed expectations.
Canadian dollar (CAD) retreats on jobs shock
The Canadian dollar (CAD) also struggled on Friday, dragged lower after domestic labour market figures showed unemployment jumped to its highest level in four years.
In the absence of significant Canadian releases, CAD movement is likely to be influenced by oil price shifts. A continued decline in crude could see further weakness in the ‘loonie’.
Australian dollar (AUD) lifted by risk-on mood
The Australian dollar (AUD) opened the week on the front foot, with demand for the risk-sensitive currency boosted by ongoing weakness in the US dollar.
New Zealand dollar (NZD) firms amid upbeat sentiment
The New Zealand dollar (NZD) also gained ground overnight, benefitting from improved risk appetite during the Asian trading session.
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