Pound (GBP) supported as UK bond yields continue to ease
The pound (GBP) remained on firm footing at the close of last week’s session as falling UK bond yields helped counterbalance disappointing domestic retail sales figures.
Muted market activity due to the UK bank holiday then left Sterling trading in a narrow range on Monday.
Looking ahead to today, the Confederation of British Industry’s (CBI) latest distributive trades survey may weigh on Sterling if May’s figures indicate another steep drop in retail activity.
Euro (EUR) subdued as German confidence remains weak
The euro (EUR) struggled for direction on Friday after German business sentiment posted only a slight recovery this month, following April’s plunge to a six-year low.
EUR exchange rates then stayed largely rangebound through Monday’s session as many European markets were also closed for an extended weekend.
With no major Eurozone economic data due today, the euro may continue to trade without a clear trend.
US dollar (USD) volatile amid changing Middle East peace expectations
The US dollar (USD) strengthened at the end of last week as cautious market sentiment boosted demand for the safe-haven currency.
However, USD sentiment weakened on Monday after US President Donald Trump stated that a peace agreement with Iran had been ‘largely negotiated’.
Fresh US strikes on targets in southern Iran overnight have since renewed doubts over any agreement and may help support the US dollar through today’s session.
Canadian dollar (CAD) pressured despite upbeat retail sales figures
The Canadian dollar (CAD) weakened on Friday as lower oil prices overshadowed stronger-than-expected domestic retail sales data.
Looking ahead, the ‘loonie’ is likely to remain sensitive to oil price movements today, with any additional declines in crude potentially dragging CAD exchange rates lower once again.
Australian dollar (AUD) weighed down by Middle East uncertainty
The Australian dollar (AUD) edged lower through Tuesday’s Asian trading session as renewed tensions in the Middle East dampened demand for the risk-sensitive currency.
New Zealand dollar (NZD) retreats amid cautious sentiment
The New Zealand dollar (NZD) also slipped in overnight trade amid the prevailing risk-off market mood.
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