The pound will be influenced by a string of high-impact UK economic releases this week, with the currency potentially enjoying tailwinds if the data underpins hawkish bets for UK monetary policy.
Last week's key rate movements
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GBP/EUR – Up 0.2% on the week
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GBP/USD – Up 0.3% on the week
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EUR/USD – Unchanged on the week
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AUD/USD – Up 0.2% on the week
Pound (GBP)
There is a glut of UK economic releases this week, with the highlights being the latest employment and inflation figures. Expect to see the pound (GBP) appreciate if the data strengthens Bank of England (BoE) rate hike bets.
Euro (EUR)
The Eurozone’s preliminary PMIs for August will likely be the main focus for EUR investors this week. Any signs of resilience in the bloc’s private sector could lend some support to the euro (EUR) in the latter half of the session.
US dollar (USD)
The minutes from the Fed’s July policy meeting may act as the primary catalyst for the US dollar (USD) this week as they hunt for any further clues as to whether policymakers may support an interest rate hike in the coming months.
Australian dollar (AUD)
Australia publishes its latest employment figures later this week, with the Australian dollar (AUD) poised to weaken if a slowdown in employment growth tempers Reserve Bank of Australia (RBA) tightening expectations.
South African rand (ZAR)
South Africa will publish its latest consumer price index this week, with economists predicting inflation continued to accelerate through July. Another uptick in price growth is likely to boost the South African rand (ZAR) as it places more pressure on the South African Reserve Bank (SARB) to raise interest rates.
Canadian dollar (CAD)
Canada will also publish its latest CPI figures this week, with the Canadian dollar (CAD) opening the session on strong footing if an acceleration in inflation is seen as encouraging the Bank of Canada (BoC) to tighten monetary policy later in the year.
New Zealand dollar (NZD)
The New Zealand dollar (NZD) may extend its recent recovery this week if data shows that domestic producer prices accelerated through the second quarter.
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