Pound (GBP) lifted by modest recovery in GDP
The pound (GBP) strengthened yesterday as the UK’s latest GDP figures reported a rebound in economic growth in August.
While the growth remained very modest, it appeared to be enough to dampen recent bets that the Bank of England (BoE) might still cut interest rates one final time in 2025.
GBP investors will look to a speech by Bank of England (BoE) Chief Economist Huw Pill for fresh impetus today. As one of the most hawkish members of the Monetary Policy Committee, Pill’s remarks could help extend the upside in Sterling.
Euro (EUR) underpinned by easing French political concerns
The euro (EUR) attracted modest support on Thursday, amid an easing of political uncertainty in the Eurozone’s second-largest economy.
Much to the relief of EUR investors, recently appointed Prime Minister Sébastien Lecornu survived two no-confidence votes, averting the collapse of yet another French government and staving off the need for fresh elections.
Turning to today’s session, barring a revision to the Eurozone’s finalised inflation figures for September, the euro may struggle to find direction.
US dollar (USD) dented by risk-positive mood
The US dollar (USD) was subdued through yesterday’s session as positive risk flows limited demand for the safe-haven currency.
Reinforcing the downside in USD were dovish Federal Reserve interest rate expectations, following cautious remarks from several Fed policymakers.
The US dollar risks sliding to fresh lows today as concerns over the resilience of the US regional banking sector and private sector credit drag on USD sentiment.
Canadian dollar (CAD) pressured by soft oil prices
The commodity-linked Canadian dollar (CAD) was muted on Thursday as oil prices hovered around a five-month low.
The ‘loonie’ is likely to remain sensitive to oil price dynamics through the remainder of the week, with demand for CAD likely to remain suppressed so long as crude continues to slide.
Australian dollar (AUD) extends post-labour report slide
The Australian dollar (AUD) remained firmly on the defensive through Friday’s Asian trading session as the odds for another rate cut from the Reserve Bank of Australia (RBA) in November jumped from 50% to 85% in the wake of Thursday’s abysmal labour data.
New Zealand dollar (NZD) wavers in uneven trade
The New Zealand dollar (NZD) was muted in overnight trade, with the ‘kiwi’ struggling to find direction amid a mixed market mood.
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