Pound (GBP) remains buoyed by potential UK-EU reset
The pound (GBP) closed last week's session on positive footing, allowing the currency to consolidate the gains it enjoyed earlier in the session.
The continued upside in Sterling remained linked to Prime Minister Andy Burnham's recent remarks on resetting UK-EU relations and the potential of going 'all the way' by rejoining the bloc.
Confirmation that the UK's vital services sector slowed in September could act as a headwind for the pound at the start of this week, in the absence of any other notable GBP economic releases.
Euro (EUR) stumbles despite soaring inflation
The euro (EUR) found itself on the defensive on Friday, despite Eurozone inflation surging to a three-year high in September.
While headline inflation outpaced expectations and rose to 3.8%, core inflation held steady at 2.5%, supporting the European Central Bank’s (ECB) stance that we are yet to see any second-round effects of the energy price surge, giving it leeway to leave rates on hold again this month.
Meanwhile, the euro is under renewed pressure this morning amid mounting concerns over France's ever-growing debt burden.
US dollar (USD) slides as payrolls disappoint
The US dollar (USD) retreated at the end of last week, in the wake of a weaker-than-expected US non-farm payrolls report.
With the US economy only adding 29,000 jobs in September against the 90,000 forecast, it effectively erased the odds of the Federal Reserve raising interest rates this month.
The release of the latest ISM services PMI may underpin fresh support for the US dollar at the start of this week if it reports continued resilience in the US private sector.
Canadian dollar (CAD) slips as oil prices slide
The Canadian dollar (CAD) ended last week on the defensive as Brent crude fell back below $100 per barrel.
Expect the link between oil prices and the 'loonie' to continue to influence CAD exchange rates at the start of this week, potentially leading to further resistance if prices continue to retreat.
Australian dollar (AUD) slips in cautious trade
The Australian dollar (AUD) trended lower through today's Asian session as a downbeat mood sapped market risk appetite.
New Zealand dollar (NZD) pressured by risk-averse mood
The New Zealand dollar (NZD) was also pressured by risk-off flows in overnight trade, leaving the 'kiwi' to drift lower.
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