Pound (GBP) weakened by mounting political pressure on Starmer
The pound (GBP) began the week on the back foot amid renewed uncertainty surrounding Keir Starmer’s future as Prime Minister.
Although Starmer attempted to project confidence by insisting he would remain in office, reports suggesting an increasing number of Labour MPs want him replaced weighed heavily on Sterling sentiment.
Political developments in the UK are likely to remain the main driver of GBP movement today, with the pound already facing further pressure amid claims senior cabinet figures have also urged Starmer to resign.
Euro (EUR) muted amid lack of clear market direction
The euro (EUR) traded sideways on Monday, with the single currency struggling to find momentum amid a cautious market backdrop.
The absence of any major Eurozone data releases at the beginning of the week also contributed to the lack of direction in EUR trading.
Germany’s latest ZEW economic sentiment index may provide fresh impetus for the euro today, with EUR exchange rates potentially softening if confidence in the Eurozone’s largest economy weakened further this month.
US dollar (USD) supported as ceasefire optimism fades
The US dollar (USD) pushed higher yesterday as hopes for a US-Iran peace deal continued to unravel.
Market optimism surrounding a diplomatic breakthrough faded after US President Donald Trump described Tehran’s reaction to the proposed peace agreement as ‘completely unacceptable’.
Looking ahead, USD investors will focus on the latest US consumer price index, with another rise in inflation likely to bolster demand for the US dollar.
Canadian dollar (CAD) lifted by stronger oil prices
The commodity-linked Canadian dollar (CAD) rose on Monday as escalating Middle East tensions drove oil prices back above $100 a barrel.
The ‘loonie’ could extend these gains today should crude prices continue to trend upward.
Australian dollar (AUD) pressured by weak confidence data
The Australian dollar (AUD) slipped during Tuesday’s Asian session after Australia’s latest business confidence figures indicated sentiment deteriorated again in April.
New Zealand dollar (NZD) weakened by cautious market mood
The New Zealand dollar (NZD) also fell back in overnight trade as geopolitical uncertainty in the Middle East dampened investor appetite for risk-sensitive currencies.
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