Pound (GBP) underpinned by BoE Pill remarks
The pound (GBP) closed last week’s session on positive footing, following remarks from Bank of England (BoE) Chief Economist Huw Pill.
Pill suggested the bank should ‘act more promptly’ in response to new inflationary risks, further fuelling bets the BoE could hike interest rates this summer.
UK markets reopen today after the bank holiday weekend, but in the absence of any notable data, liquidity in the pound may remain limited.
Euro (EUR) buoyed by USD weakness
The euro (EUR) ticked higher on Friday, supported by its inverse trading relationship with the US dollar (USD).
However, with most European markets closed for May Day celebrations, thin trading conditions ultimately capped the single currency’s upside potential.
European Central Bank (ECB) President Christine Lagarde is scheduled to speak later today. If her comments touch on the need for more restrictive monetary policy in the face of growing inflation risks, they could propel the euro higher.
US dollar (USD) volatile amid renewed Middle East tensions
The US dollar fluctuated at the end of last week, initially stumbling as Iran presented a revised peace proposal to the US, before recouping most of its losses by the end of the session as sentiment soured.
The recovery then extended through to the start of this week as tensions in the Middle East began to flare again.
Today sees the release of the latest JOLTs job openings data, with the US dollar poised to strengthen if it reports an uptick in labour demand at the end of the first quarter.
Canadian dollar (CAD) buoyed by acceleration in factory activity
The Canadian dollar (CAD) firmed on Friday, following a surprising expansion in Canada’s manufacturing sector in April, extending these gains as oil prices spiked on Monday.
Coming up, if oil prices continue to accelerate, the ‘loonie’ may maintain a positive trajectory today.
Australian dollar (AUD) slips despite RBA rate hike
The Australian dollar (AUD) stumbled through today’s Asian trading session, as the Reserve Bank of Australia’s (RBA) third consecutive interest rate hike had largely been priced in by investors in advance.
New Zealand dollar (NZD) flat in cautious trade
The New Zealand dollar (NZD) was muted in overnight trade as risk appetite remained pressured by events in the Middle East.
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