Pound (GBP) steady as markets unfazed by Starmer resignation
The pound (GBP) traded with remarkable resilience at the start of this week as Prime Minister Keir Starmer announced his resignation, less than two years into his term.
Given there had been multiple media reports of his resignation over the weekend, GBP investors were willing to take the announcement in their stride, particularly as UK gilt yields fell in the hours that followed.
Offering a potential distraction from political headlines today will be the UK’s latest PMIs. Following a contraction in May, will a rebound in private sector activity this month lift the pound?
Euro (EUR) pressured by ECB Lagarde remarks
The euro (EUR) faced headwinds through Monday’s session in response to comments from European Central Bank (ECB) President Christine Lagarde.
Speaking before a European Parliament committee, Lagarde suggested there is not yet evidence that the recent inflation shock warrants ‘more forceful policy action’ from the bank.
Today also sees the publication of the Eurozone’s latest PMI, with June’s preliminary index likely to exert pressure on the single currency if it reports the bloc’s private sector suffered its third consecutive contraction.
US dollar (USD) firms amid shaky start to US-Iran peace talks
The US dollar (USD) traded with modest support yesterday as a tense start to US-Iran technical negotiations underpinned safe-haven demand.
These gains were supported by US monetary policy speculation amid rising expectations that the Federal Reserve will deliver an interest rate hike by the end of summer.
US economic indicators are in short supply today, which will likely leave movement in the ‘greenback’ to be driven by wider market trends.
Canadian dollar (CAD) underpinned by hotter-than-expected inflation print
The Canadian dollar (CAD) held its ground on Monday as a stronger-than-forecast acceleration in domestic inflation last month buoyed Bank of Canada (BoC) rate hike bets.
Turning to today’s session, the ‘loonie’ may struggle to attract support if oil prices continue to retreat.
Australian dollar (AUD) slips despite positive PMIs
The Australian dollar (AUD) retreated overnight on Monday, with a deteriorating market mood overshadowing Australia’s better-than-forecast PMI data.
New Zealand dollar (NZD) pressured by risk-off flows
The New Zealand dollar (NZD) also stumbled in overnight trade amid the risk-averse shift in market sentiment.
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