Pound (GBP) muted as consumer confidence weakens
The pound (GBP) was subdued through yesterday’s session as data showed UK consumer confidence fell to a three-year low this month.
The S&P Global consumer sentiment index fell to just 42.7 in September as households grow increasingly concerned about the prospect of rising interest rates and potential tax hikes.
Turning to today's session, the latest UK government borrowing figures look set to weigh on Sterling, as a larger-than-expected public deficit further limits the fiscal headroom available for the upcoming budget.
Euro (EUR) subdued as ‘disastrous’ German election rattles markets
The euro (EUR) faced modest headwinds on Monday after Germany’s regional elections proved a ‘disaster’ for the ruling CDU government.
The results raised fresh questions over Chancellor Friedrich Merz’s future as well as whether the government has the political capital to push through its economic reforms.
The Eurozone will release its latest consumer confidence figures later today, with the euro poised to weaken if sentiment deteriorated again this month.
US dollar (USD) losses capped by Fed bets
Quiet trade and an improvement in risk appetite left the US dollar (USD) muted at the start of this week.
However, the selling pressure remained modest amid the hawkish repositioning that followed the Federal Reserve’s interest rate decision last week.
Looking ahead, the latest ADP employment data may lift USD exchange rates later today if employment growth maintained a positive trajectory at the start of September.
Canadian dollar (CAD) dented by sliding oil prices
The Canadian dollar (CAD) edged lower on Monday as the commodity-linked currency was undermined by a pullback in oil prices.
The ‘loonie’ is likely to extend its losses today if this downtrend in oil prices persists and Brent falls back below $100 a barrel.
Australian dollar (AUD) rebounds on RBA comments
The Australian dollar (AUD) faced volatility in overnight trade, with an initial slump being swiftly reversed following some hawkish remarks from Reserve Bank of Australia (RBA) Governor Michele Bullock.
New Zealand dollar (NZD) soars on hawkish RBNZ signals
The New Zealand dollar (NZD) also fluctuated overnight, with the 'kiwi' rebounding from a multi-week low after Reserve Bank of New Zealand (RBNZ) Governor Anna Breman warned that the recent surge in oil prices is likely to see inflation exceed the bank's most recent forecasts.
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