Pound (GBP) directionless as investors await data
The pound (GBP) struggled to establish a clear direction yesterday as a lack of UK economic data left Sterling without much domestic impetus.
GBP investors also remained cautious about making significant moves ahead of several high-impact releases scheduled for later this week.
The first of these is due today, with the UK’s latest jobs report set to take centre stage. The pound has slipped this morning despite indications that the labour market remains broadly stable. Rising government borrowing costs appear to be weighing on GBP.
Euro (EUR) pressured by stronger USD
The euro (EUR) came under pressure yesterday, with the common currency hampered by its strong inverse relationship with the US dollar (USD) as the latter strengthened.
At the same time, a lack of economic data from the Eurozone made it difficult for EUR to attract much support.
Attention for EUR investors turns to Germany’s latest ZEW economic sentiment index today. A fifth consecutive improvement could potentially help the euro claw back some of its recent losses.
US dollar (USD) advances on Fed rate hike expectations
The US dollar pushed higher on Monday as investors favoured the currency ahead of an interest rate hike widely expected from the Federal Reserve later this week.
The safe-haven ‘greenback’ also benefited from a risk-averse market mood, with developments in the Middle East weighing on sentiment.
Looking ahead, the US dollar could continue to find support today if risk-off conditions persist.
Canadian dollar (CAD) subdued by inflation data
The crude-linked Canadian dollar (CAD) initially gained ground yesterday after oil prices jumped. However, softer-than-expected inflation figures subsequently put pressure on the ‘loonie’ during the afternoon.
Turning to today, CAD could find support if crude prices remain elevated.
Australian dollar (AUD) falls amid risk-off conditions
The Australian dollar (AUD) recovered some of its losses yesterday evening before falling back again overnight as a risk-off market mood returned.
New Zealand dollar (NZD) sinks to two-month lows amid risk aversion
The New Zealand dollar (NZD) also weakened overnight as risk aversion dominated markets, with the ‘kiwi’ falling to two-month lows against some of its peers.
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