Pound (GBP) weakens as UK borrowing jumps
The pound (GBP) ended last week under pressure after a sharp rise in UK government borrowing overshadowed upbeat retail sales data.
Public sector borrowing climbed close to £18bn in August, fuelling concerns over the fiscal challenges facing Chancellor Rachel Reeves ahead of her autumn budget.
At the start of this week, GBP traders will look to comments from Bank of England (BoE) Chief Economist Huw Pill. As one of the BoE’s more hawkish voices, his speech could lend some support to Sterling.
Euro (EUR) softens after ECB remarks
The euro (EUR) drifted lower on Friday following comments from outgoing European Central Bank (ECB) policymaker Mario Centeno.
Centeno cautioned that the ECB will not allow inflation to undershoot its 2% goal for an extended period, while hinting its next move is likely to be a rate cut.
Today brings the release of the Eurozone’s latest consumer confidence reading, with the euro at risk of losses if sentiment weakened further in September.
US dollar (USD) extends rebound post-Fed
The US dollar (USD) firmed at the end of last, building on its recovery following the Federal Reserve’s interest rate decision earlier in the week.
This was driven by investors scaling back bets on aggressive rate cuts, after the Fed flagged persistent inflation risks and US jobless claims fell by more than anticipated.
A flurry of speeches from Fed officials will be closely watched today. If policymakers strike a hawkish tone, it could help the US dollar sustain its recent gains.
Canadian dollar (CAD) climbs on strong retail sales
The Canadian dollar (CAD) gained ground on Friday after data revealed an unexpected rebound in Canadian retail sales in August.
Looking to today, the release of Canada’s producer price index could provide fresh support for the ‘loonie’ if inflation shows signs of accelerating.
Australian dollar (AUD) subdued on RBA remarks
The Australian dollar (AUD) was little changed during Asian trading on Monday after Reserve Bank of Australia (RBA) Governor Michele Bullock reiterated that the bank is prepared to act if economic conditions worsen.
New Zealand dollar (NZD) rangebound in cautious mood
The New Zealand dollar (NZD) traded sideways overnight as investor caution limited appetite for the ‘kiwi’.
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