The US dollar accelerated last week as an upward revision to US GDP in the second quarter triggered a repricing of expectations for future Federal Reserve interest rate cuts.
Last week's key rate movements
-
GBP/EUR – Down 0.2% on the week
-
GBP/USD – Down 0.6% on the week
-
EUR/USD – Down 0.4% on the week
-
AUD/USD – Down 0.7% on the week
Pound (GBP)
The most notable UK economic release this week will be the UK’s second-quarter GDP print. However, barring a revision to the finalised growth figures, its impact on the pound (GBP) may be limited, with GBP investors instead looking to a series of speeches by Bank of England (BoE) policymakers for fresh impetus.
Euro (EUR)
The primary catalyst of movement for the euro (EUR) this week will be the publication of the latest Eurozone consumer price index. If September’s preliminary figures report another acceleration in inflation, it’s likely to cement bets the European Central Bank’s (ECB) cutting cycle is over and bolster EUR demand.
US dollar (USD)
The spotlight this week will undoubtedly be on the latest US payroll figures. Federal Reserve interest rate cut bets are likely to be strengthened if September’s data reports the US labour market continues to cool, which in turn is expected to pile significant pressure on the US dollar (USD).
Australian dollar (AUD)
The Reserve Bank of Australia’s (RBA) latest interest rate decision will be the focus for AUD investors this week. Expect the Australian dollar (AUD) to strengthen if the bank leaves rates unchanged and maintains its hawkish guidance.
South African rand (ZAR)
In the absence of any notable domestic data, the South African rand (ZAR) is likely to be driven by broader market movements this week. Broad USD weakness could make the rand more appealing to investors.
Canadian dollar (CAD)
CAD data is in short supply this week, likely leaving the movement of the Canadian dollar (CAD) tied to oil price dynamics. If the recent rally in oil prices persists, the ‘loonie’ may strengthen.
New Zealand dollar (NZD)
The New Zealand dollar (NZD) is likely to remain sensitive to market risk appetite this week, with the ‘kiwi’ potentially rising if a weaker US dollar bolsters demand for high-yield assets.
Never miss a movement. Create a free account with Currencies Direct to get the latest currency news delivered straight to your inbox. You can also set up rate alerts and check live rates 24/7.
