Pound (GBP) quiet as fiscal doubts simmer
The pound (GBP) ended last week on the back foot, with lingering scrutiny of the UK autumn budget draining some of the confidence that briefly lifted Sterling after Wednesday’s announcement.
Investors worried that the government’s long-term plans may not inspire lasting market trust, particularly as much of the fiscal tightening is backloaded, raising the risk that it might never fully materialise.
With no meaningful UK data on the schedule today, domestic political noise and the ongoing appraisal of the budget are likely to steer GBP trade.
Euro (EUR) softens as optimism over Ukraine negotiations falters
The euro (EUR) weakened on Friday as hopes for progress towards a Ukraine peace deal continued to recede.
EUR was further pressured by weaker-than-forecast German inflation figures, prompting a slight dovish adjustment in European Central Bank (ECB) policy expectations.
Beyond November’s final manufacturing PMI, the Eurozone offers no notable releases today, leaving the single currency sensitive to any developments surrounding diplomatic efforts to end the Russia-Ukraine conflict.
US dollar (USD) drifts as markets brace for Fed cuts
The US dollar (USD) failed to mount a firm recovery at the end of last week, with some USD bargain hunting insufficient to lift the currency in any meaningful way.
Growing confidence that the Federal Reserve could cut interest rates this month kept the lid on USD demand, after a bruising week of losses.
Today’s ISM manufacturing PMI is forecast to show that US factory activity remained in contraction last month, a result that could apply fresh pressure to the dollar.
Canadian dollar (CAD) finds lift from stronger GDP
The Canadian dollar (CAD) pushed higher on Friday after quarterly GDP figures surpassed expectations, offering the ‘loonie’ some welcome support.
Attention now turns to Canada’s latest manufacturing PMI. Although activity is expected to improve modestly in November, it’s still set to remain subdued, which may cap further CAD gains.
Australian dollar (AUD) steadies despite uneven data mix
The Australian dollar (AUD) held its ground overnight. Domestic company profits unexpectedly flatlined in the third quarter, but a hotter-than-anticipated monthly inflation print helped counterbalance the disappointment.
New Zealand dollar (NZD) rangebound in cautious trade
The New Zealand dollar (NZD) moved sideways overnight, with a data-light calendar and an uncertain market backdrop leaving the ‘kiwi’ largely directionless.
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