Pound (GBP) slides as UK borrowing spikes
The pound (GBP) closed last week’s session on a sour note as a surge in UK government borrowing overshadowed robust retail sales figures.
Public sector borrowing ballooned to almost £18bn in August, raising fresh concern over the pressures facing Chancellor Rachel Reeves as she prepares her autumn budget.
GBP investors will look to a speech by Bank of England (BoE) Chief Economist Huw Pill for impetus at the start of this week. As one of the BoE’s more hawkish policymakers, his comments could help propel Sterling higher.
Euro (EUR) slips on ECB inflation warning
The euro (EUR) faced headwinds on Friday, following comments from outgoing European Central Bank (ECB) Governing Council member Mario Centeno.
Centeno warned that the ECB won’t tolerate inflation falling below its 2% target for too long and that its next move is likely to be a rate cut.
Today sees the publication of the Eurozone’s latest consumer confidence figures, with the euro likely to be undermined if sentiment continued to deteriorate in September.
US dollar (USD) maintains post-Fed recovery
The US dollar (USD) strengthened at the end of last week, extending the recovery that followed the Federal Reserve’s interest rate decision on Wednesday.
This came as USD investors continued to reprice their rate cut bets in the wake of the Fed’s warning on inflation risks and a larger-than-expected fall in US jobless claims.
A series of speeches by Fed policymakers may offer direction for the US dollar at the start of this week. A hawkish consensus could help the US dollar to maintain its positive momentum.
Canadian dollar (CAD) bolstered by rebound in retail sales
The Canadian dollar (CAD) ticked higher on Friday as CAD investors welcomed a surprisingly strong rebound in domestic retail sales last month.
Coming up, could an acceleration in Canadian producer price inflation propel the ‘loonie’ higher at the start of this week?
Australian dollar (AUD) muted on RBA Bullock comments
The Australian dollar (AUD) struggled to attract support during Monday’s Asian trading session, following remarks from Reserve Bank of Australia (RBA) Governor Michele Bullock, who stated the RBA remains ready to respond if conditions deteriorate.
New Zealand dollar (NZD) flat in cautious trade
The New Zealand dollar (NZD) was rangebound in overnight trade, with investors reluctant to buy into the ‘kiwi’ amid a cautious market mood.
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