Pound (GBP) brushes off soft UK readings
The pound (GBP) ended last week on the front foot, with the currency largely ignoring a run of disappointing UK data.
Alongside an unexpected plunge in retail sales, last month’s preliminary PMIs indicated a marked loss of momentum in the UK’s dominant services sector, reflecting uncertainty ahead of Chancellor Rachel Reeves’s forthcoming budget.
With attention firmly fixed on Wednesday’s announcement, the pound may see muted directional movement over the coming days.
Euro (EUR) slips after Lagarde strikes cautious tone
The euro (EUR) edged lower on Friday, even as the Eurozone’s latest PMIs signalled a pick-up in private sector activity.
EUR sentiment faded after European Central Bank (ECB) President Christine Lagarde cautioned that the region remains exposed to the risks posed by a fracturing global order.
Germany’s newest business climate index is the main Eurozone release today. If confidence in the bloc’s largest economy has strengthened again this month, it could help revive the euro.
US dollar (USD) softens as Fed comments curb momentum
The US dollar (USD) weakened at the end of last week after Federal Reserve official John Williams dialled back some of the recent hawkish rhetoric.
Williams argued that current monetary settings are still fairly restrictive and signalled that rate cuts remain possible if conditions evolve as expected.
With little US data due early this week, the dollar may face additional pressure as markets continue adjusting their Fed expectations.
Canadian dollar (CAD) retreats on disappointing sales figures
The Canadian dollar (CAD) dipped on Friday as Canada’s retail sales data undershot forecasts, revealing that spending stagnated in October rather than rebounding by 0.5%.
If crude prices continue to trend lower, the commodity-linked ‘loonie’ could remain on the back foot as the week progresses.
Australian dollar (AUD) steady amid uneven sentiment
The Australian dollar (AUD) moved within a tight range through Monday’s Asian session, with limited domestic catalysts and mixed risk appetite contributing to muted trade.
New Zealand dollar (NZD) quiet as week opens
The New Zealand dollar (NZD) also lacked momentum at the start of the week, with subdued market activity keeping the currency contained.
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