Pound (GBP) undermined by weaker retail sales
Sterling (GBP) ended last week on the back foot after the UK’s latest retail sales report revealed that consumer spending fell more sharply than anticipated in September.
The disappointing figures overshadowed the latest UK PMI results, which showed activity in the country’s crucial services sector expanding at its fastest pace in eight months during October.
Looking ahead, the pound may struggle to find direction at the beginning of this week as investors turn their attention to Chancellor John Healey’s first Autumn Budget, due to be delivered on Wednesday.
Euro (EUR) pressured by weakening private sector activity
The euro (EUR) remained under pressure towards the end of last week as investors digested the Eurozone’s latest PMI figures.
The preliminary October surveys pointed to weaker activity across both manufacturing and services, adding to doubts over whether the European Central Bank (ECB) will consider raising interest rates later this week.
Meanwhile, the single currency may remain under pressure today if Germany’s latest IFO business climate index signals a deterioration in business confidence this month.
US dollar (USD) gains limited by uneven PMI results
The US dollar (USD) made modest progress on Friday as a sharp increase in oil prices continued to unsettle financial markets.
However, the advance lost momentum later in the session after the latest US PMI releases delivered a mixed picture of private sector activity, limiting demand for the ‘greenback’.
With little significant US data due at the start of this week, the currency could trade without a clear direction as investors await Wednesday’s Federal Reserve interest rate decision.
Canadian dollar (CAD) rallies on stronger oil prices and retail sales
The Canadian dollar (CAD) ranked among Friday’s strongest performers, benefiting from rising oil prices and a stronger-than-forecast increase in domestic retail sales in September.
However, the ‘loonie’ could give back some of its recent gains today if crude prices continue to retreat from Friday’s elevated levels.
Australian dollar (AUD) supported by hawkish RBA signals
The Australian dollar (AUD) traded close to a five-week high during Monday’s Asian session after Reserve Bank of Australia (RBA) Assistant Governor Sarah Hunter indicated that further action was needed to bring inflation under control.
New Zealand dollar (NZD) muted ahead of RBNZ decision
The New Zealand dollar (NZD) moved sideways in overnight trade as investors positioned themselves ahead of an expected interest rate increase from the Reserve Bank of New Zealand (RBNZ) later this week.
Never miss a movement. Create a free account with TorFX to get the latest currency news delivered straight to your inbox. You can also set up rate alerts and check live rates 24/7.