Pound (GBP) supported by rising producer prices
The pound (GBP) rose against many of its peers during Wednesday’s session, with the UK currency being underpinned by new British PPI data.
Interim figures from the Office for National Statistics (ONS) pointed to a sharp rise in producer price inflation in the second quarter, adding to evidence of sticky price pressures in the UK and reinforcing hawkish Bank of England (BoE) interest rate expectations.
With UK economic data thin on the ground today, Sterling could trade without a clear directional bias.
Euro (EUR) dented by downbeat German data
The euro (EUR) fell yesterday after Germany’s September consumer confidence index pointed to a sharper-than-forecast deterioration in morale in the Eurozone’s largest economy.
Additionally, the common currency suffered from its strong negative correlation with a rising US dollar (USD).
The European Central Bank’s (ECB) latest policy minutes are the focus for EUR investors today. If the accounts show a broadly hawkish consensus among policymakers, the euro could climb.
US dollar (USD) wavers as risk appetite shifts
Safe-haven flows lifted the US dollar yesterday, with a risk-off mood gripping markets as hefty US tariffs on Indian goods came into effect.
However, the mood improved later in the session, in part due to bumper earnings from AI chip-maker Nvidia, which saw USD fall back.
Today, the second estimate for US GDP growth in the second quarter could impact USD if it differs from the preliminary estimate. US jobless claims could also affect the ‘greenback’, with another high reading potentially dragging on the American dollar.
Canadian dollar (CAD) boosted by rising oil and USD
The crude-linked Canadian dollar (CAD) climbed yesterday, with the ‘loonie’ enjoying a recovery in oil prices and a rising US dollar.
The latest average earnings data could support CAD today, if it shows that wage growth continues to outpace inflation. Otherwise, oil price dynamics and USD movement could influence the Canadian dollar.
Australian dollar (AUD) moves sideways in absence of data
The Australian dollar (AUD) was mostly rangebound overnight amid a lack of domestic data and a lukewarm market mood.
New Zealand dollar (NZD) flat despite improving business confidence
The New Zealand dollar (NZD) also traded sideways last night, with the ‘kiwi’ unable to push higher despite a larger-than-expected improvement in domestic business confidence in August.
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