Pound (GBP) constrained by Burnham leadership uncertainty
The pound (GBP) traded within a limited range yesterday as investors continued to assess the implications of the UK’s ongoing leadership contest.
Although Andy Burnham has sought to reassure markets over his commitment to fiscal discipline, uncertainty surrounding his choice of Chancellor has continued to weigh on confidence in Sterling.
Looking ahead, lingering political uncertainty and concerns over future fiscal policy are likely to keep GBP exchange rates under pressure through the close of the week.
Euro (EUR) weighed down by disappointing German figures
The euro (EUR) remained subdued on Thursday after the release of Germany’s latest consumer confidence survey.
Although sentiment improved slightly heading into July, the reading failed to meet market expectations.
With no major Eurozone data releases scheduled today, broader market sentiment is likely to remain the main driver of euro movement through the session.
US dollar (USD) volatile as stronger US GDP supports Fed expectations
The US dollar (USD) experienced choppy trading yesterday, surrendering its early gains during the European session before recovering on the back of stronger economic data.
An upward revision to US GDP, alongside firmer inflation figures, helped the ‘greenback’ regain momentum as investors increased expectations for a Federal Reserve interest rate hike.
Aside from a possible revision to US consumer confidence, wider market sentiment is expected to dictate USD movement today, with another incident involving shipping in the Strait of Hormuz capable of boosting safe-haven demand.
Canadian dollar (CAD) weakened by softer oil prices
The Canadian dollar (CAD) edged lower on Thursday as declining oil prices continued to undermine the commodity-linked currency.
The ‘loonie’ may remain under pressure through today’s session if crude prices extend their recent losses into the weekend.
Australian dollar (AUD) pressured by renewed risk aversion
The Australian dollar (AUD) moved lower during Thursday’s overnight session after the UN suspended the evacuation of vessels in the Strait of Hormuz following an attack on a commercial ship.
New Zealand dollar (NZD) slips as cautious sentiment persists
The New Zealand dollar (NZD) also came under pressure overnight as the latest developments in the Strait of Hormuz dampened investor risk appetite.
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