Pound (GBP) subdued despite strong retail sales rebound
The pound (GBP) traded without clear direction at the end of last week as investors digested the UK’s latest retail sales figures.
Although sales growth picked up far more than expected last month, the data indicated the increase was largely driven by higher motor fuel prices, with underlying sales volumes showing more limited improvement.
The Confederation of British Industry (CBI) will release its latest distributive trades survey later today, with Sterling at risk of slipping if the downturn in the UK’s retail balance worsened this month.
Euro (EUR) brushes off weak German sentiment data
The euro (EUR) ticked higher on Friday, supported by its negative correlation with the US dollar (USD).
This helped offset Germany’s latest IFO business climate index, which showed confidence dropped to its lowest level in six years in April.
However, separate data revealing German consumer confidence has fallen to a three-year low may cap the euro’s gains this morning.
US dollar (USD) weighed down by profit-taking
The US dollar (USD) edged lower at the close of last week, as investors locked in profits following a climb to a 10-day peak earlier in the session.
That said, losses were limited by the continued blockade of the Strait of Hormuz.
Looking ahead, developments in the Middle East are likely to remain a key driver of global risk sentiment and USD demand early this week. Reports that Iran has presented the US with a proposal to end the conflict have already lifted market mood, to the detriment of the ‘greenback’.
Canadian dollar (CAD) subdued as retail sales disappoint
The Canadian dollar (CAD) was muted through Friday’s trading session, following weaker-than-expected domestic retail sales figures.
Oil prices are likely to remain the main influence on the ‘loonie’ at the start of this week, with further gains possible if crude continues to trend higher.
Australian dollar (AUD) supported by Middle East optimism
The Australian dollar (AUD) edged higher in overnight trading after reports suggested Iran has approached the US with a proposal to reopen the Strait of Hormuz.
New Zealand dollar (NZD) lifted by improved risk sentiment
The New Zealand dollar (NZD) also advanced during Monday’s Asian session, buoyed by the more positive market mood tied to Iran’s proposal.
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