Pound (GBP) firms despite UK fiscal unease
The pound (GBP) opened this week’s session on positive footing, despite the absence of any clear catalyst for the move.
The uptick in Sterling was particularly surprising given the broader backdrop of UK fiscal jitters in light of recent underwhelming economic indicators.
Today sees the release of the Bank of England’s (BoE) latest consumer credit figures, with the pound potentially coming under pressure if June’s data points to a weakening of household spending.
Euro (EUR) retreats as EU-US trade deal disappoints EUR investors
The euro (EUR) initially strengthened on Monday, following news that the EU and the US had finally reached a trade agreement over the weekend.
However, this initial optimism didn’t last, with the euro relinquishing its early gains during the European session, as EUR investors were ultimately unimpressed by the details of the deal.
Growing criticism of the deal from EU members like Germany and France could even call the agreement into question and place more pressure on the euro today.
US dollar (USD) rallies on US trade deal relief
The US dollar (USD) got off to a strong start this week as the EU-US trade framework came as a welcome relief to USD investors.
USD demand was also underpinned by growing bets that the Federal Reserve will keep US interest rates higher for longer, amid the continued resilience of the US economy.
Tuesday’s session could see the US dollar relinquish some of its recent gains as the latest US job openings and labor turnover survey is expected to report a fall in the number of job openings last month.
Canadian dollar (CAD) supported by rising oil prices
The Canadian dollar (CAD) trended broadly higher on Monday as the commodity-linked currency tracked the rise in oil prices.
Expect the ‘loonie’ to maintain its positive momentum if crude prices continue to rally through today’s session.
Australian dollar (AUD) subdued as US-China trade talks resume
The Australian dollar (AUD) was left to nurse its wounds overnight on Monday, amid persistent USD demand and caution ahead of the resumption of US-China trade talks.
New Zealand dollar (NZD) undermined by risk-off flows
The New Zealand dollar (NZD) was also muted in overnight trade amid the risk-off market mood.
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