Pound (GBP) mixed despite upbeat UK GDP
The pound (GBP) struggled to attract any meaningful support at the end of last week, despite stronger-than-expected UK GDP data.
While a surprise expansion in the UK economy in July was welcomed by markets, it wasn’t seen as moving the needle in terms of Bank of England (BoE) policy and failed to boost Sterling.
It may be a slow start to the session for the pound this week as GBP investors brace for several high-impact UK economic releases as well as the BoE’s upcoming interest rate decision.
Euro (EUR) muted as safe-haven demand falters
A lull in Eurozone economic releases saw the euro (EUR) trade without strong directional bias on Friday.
While hawkish European Central Bank (ECB) speculation offered some support, it was not enough to counter the shift in market risk dynamics.
Eurozone economic data remains in short supply at the start of this week, which may leave movement in the euro to be driven by wider market trends.
Robust inflation fails to lift the US dollar (USD)
The US dollar (USD) was left subdued on Friday, with demand for the safe-haven currency faltering amid a more sanguine market mood.
This came in spite of bets for an interest rate hike from the Federal Reserve this week hardening in response to robust US inflation figures.
Turning to the start of this week, the US dollar is attracting fresh support as risk sentiment deteriorates. If the mood remains gloomy, USD could push higher.
Canadian dollar (CAD) pressured as oil prices soften
The Canadian dollar (CAD) stumbled over the finish line last week, with the appeal of the commodity-linked currency weakening as oil prices retreated almost 3%.
Crude is rising again this week, potentially supporting the ‘loonie’. Canada’s latest inflation figures this afternoon could also influence CAD exchange rates, particularly if there are any surprises.
Australian dollar (AUD) slips amid risk-off mood
The Australian dollar (AUD) fell overnight as a risk-averse market mood dampened demand for the ‘Aussie’.
New Zealand dollar (NZD) weakens in cautious trade
Likewise, the New Zealand dollar (NZD) stumbled out the gate this week amid an anxious tone in markets.
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