Pound (GBP) supported by BoE Pill comments
The pound (GBP) found some support at the end of last week following remarks from Bank of England (BoE) Chief Economist Huw Pill.
Pill warned that inflation is proving far more persistent than the BoE had anticipated and cautioned against cutting interest rates too soon.
At the start of this week, GBP movement may be subdued as investors hold off from making major bets ahead of the UK’s latest inflation report due on Wednesday.
Euro (EUR) gains amid risk aversion
The euro (EUR) broadly strengthened on Friday, benefiting from risk-off sentiment as investors sought the relative safety of the single currency.
That said, EUR’s advance was limited by its inverse trading relationship with the US dollar (USD).
Looking to today, Germany’s latest producer price index could weigh on the euro after data showed that factory gate prices continued to fall in September.
US dollar (USD) strengthens on China trade hopes
The US dollar ended the week on a firmer footing, shaking off earlier losses triggered by renewed concerns over the health of regional US banks.
Sentiment towards the ‘greenback’ improved following comments from US President Donald Trump, who voiced optimism about reaching a trade deal with Chinese President Xi Jinping at their upcoming October meeting.
With the US government shutdown still halting the release of key economic data, USD exchange rates are likely to remain driven by market risk appetite for now.
Canadian dollar (CAD) lifted by rising oil prices
The commodity-sensitive Canadian dollar (CAD) edged higher on Friday, tracking an uptick in oil prices.
However, today’s session could bring pressure for the ‘loonie’ if Canada’s latest producer price index points to a renewed contraction, which may reinforce expectations for further Bank of Canada (BoC) rate cuts.
Australian dollar (AUD) steady after mixed Chinese data
The Australian dollar (AUD) traded in a narrow range overnight as mixed Chinese economic figures failed to provide a clear direction.
While China’s third-quarter GDP growth slowed to its weakest pace in a year, industrial production for September significantly exceeded forecasts, offsetting some of the gloom.
New Zealand dollar (NZD) firms on inflation uptick
The New Zealand dollar (NZD) gained modestly overnight after domestic inflation data revealed stronger-than-expected price growth in the third quarter, reducing speculation of additional rate cuts from the Reserve Bank of New Zealand (RBNZ).
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