Pound (GBP) rises as services PMI revised higher
The pound (GBP) rallied yesterday, with Sterling managing to attract strong support after seemingly entering oversold conditions.
The British currency was further bolstered by the UK’s final services PMI, which showed a smaller-than-expected slowdown in activity and accelerating input cost inflation due to rising salaries.
UK data is thin on the ground today. As a result, we could see GBP exchange rates move without a clear direction.
Euro (EUR) capped by Russia concerns
The euro (EUR) rose against many of its peers yesterday, with the currency enjoying an upwardly revised Eurozone services PMI and its negative correlation with the weakening US dollar (USD).
However, EUR’s gains were limited in scope as recent hopes for a Russia-Ukraine peace deal were dampened by news that talks between Washington and the Moscow yielded little results.
A slight recovery in Eurozone retail sales in October could provide the euro with modest support today. EUR investors will also look to a speech from European Central Bank (ECB) Chief Economist Philip Lane for fresh impetus.
US dollar (USD) weakens amid Fed rate cut bets
The US dollar slid yesterday amid bets that Kevin Hassett – an ally of President Donald Trump – will almost certainly become the next Chair of the Federal Reserve in May 2026, potentially presiding over an acceleration in interest rate cuts.
A 32,000 decline in private employment in November added to USD’s woes. A weak labour market could prompt the Fed to cut rates faster than anticipated.
Looking ahead, the latest US initial jobless claims figure could impact USD today. An uptick in new benefits claims could add to worries about a slowing labour market, thereby pressuring the ‘greenback’.
Canadian dollar (CAD) choppy despite firmer oil prices
The crude-linked Canadian dollar (CAD) was volatile yesterday as rising oil prices and a falling US dollar pulled the currency in opposing directions.
Canada’s latest Ivey PMI is expected to show a slight acceleration in economic activity in November, which could help underpin the ‘loonie’ today.
Australian dollar (AUD) boosted by strong trade data
The Australian dollar (AUD) climbed overnight amid strong domestic trade figures, including a larger-than-forecast trade surplus and robust export growth in October.
New Zealand dollar (NZD) rangebound amid mixed mood
The New Zealand dollar (NZD) wavered in a narrow range overnight amid an uncertain market mood.
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