Pound (GBP) muted as data drought continues
The pound (GBP) traded without clear direction at the close of last week, with Sterling weakening against several of its firmer counterparts.
The absence of notable UK economic releases limited the currency’s ability to gain traction, leaving it vulnerable to losses.
The UK calendar remains quiet at the beginning of this week, which may see the pound continue to lack a clear direction. However, remarks from Bank of England (BoE) Chief Economist Huw Pill later this evening could offer Sterling support if he delivers a hawkish message.
Euro (EUR) softens amid improving market sentiment
The euro (EUR) came under pressure on Friday, as an improving market mood reduced demand for the safer single currency.
EUR also appeared to be weighed down by a firmer US dollar (USD), reflecting the currencies’ typically inverse relationship.
With no notable Eurozone data scheduled today, the euro may continue to trade without firm direction. However, comments from European Central Bank (ECB) policymaker Isabel Schnabel could provide support later this evening if she signals backing for further interest rate increases.
US dollar (USD) fluctuates as risk appetite improves
The US dollar experienced mixed trading conditions on Friday, with USD exchange rates moving back and forth across a broad range.
Despite easing against its strongest rivals overall, the safe-haven ‘greenback’ proved relatively resilient, helping to keep losses contained.
Attention today will turn to speeches from two Federal Reserve officials, whose remarks may influence the US dollar. At the same time, renewed conflict in the Middle East could boost demand for the safe-haven currency.
Canadian dollar (CAD) bolstered by upbeat employment figures
The Canadian dollar (CAD) advanced on Friday after Canada’s latest employment data exceeded expectations. Rising oil prices over the course of the week also helped underpin the commodity-linked currency.
Oil price movements are likely to remain an important influence on CAD today. Should crude prices extend their gains amid escalating tensions in the Middle East, the ‘loonie’ may strengthen further.
Australian dollar (AUD) retreats following renewed Middle East tensions
The risk-sensitive Australian dollar (AUD) opened the week on the back foot after fresh strikes between the US and Iran fuelled widespread market caution.
New Zealand dollar (NZD) supported by stronger-than-expected PMI
The New Zealand dollar (NZD) remained broadly stable overnight despite the risk-off backdrop, with New Zealand’s latest services PMI unexpectedly returning to expansion territory.
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