Pound (GBP) buoyed by better-than-expected GDP
The pound (GBP) enjoyed support yesterday after the UK’s GDP figures for the second quarter beat forecasts.
The British economy expanded 0.3% in Q2, above forecasts for 0.1% growth. However, as this was still a slowdown from 0.7% in the first quarter, Sterling’s gains were limited.
Today, UK economic data is thin on the ground, potentially leaving the pound to trade without a clear direction.
Euro (EUR) slips ahead of Trump-Putin summit
The euro (EUR) weakened against some of its peers yesterday as EUR investors seemed nervous about talks on Ukraine between US President Donald Trump and Russian President Vladimir Putin.
In addition, the single currency’s strong negative correlation with a rising US dollar (USD) put some pressure on EUR.
The euro may be subdued today as Trump and Putin meet in Alaska to discuss peace proposals. Any headlines emerging from the summit could infuse EUR with volatility.
US dollar (USD) firms as hot PPI tempers Fed bets
The US dollar gained ground yesterday as producer price inflation outpaced expectations in July, helping to temper recent bets on an aggressive easing cycle from the Federal Reserve.
US producer prices surged 0.9% in July, above the expected 0.2%, which could feed through into consumer price inflation. In addition, jobless claims were lower than expected, further helping to underpin USD.
Turning to today, US retail sales are the focus for USD investors. Another healthy increase in sales in July could bolster the ‘greenback’.
Canadian dollar (CAD) supported by rising oil prices
The crude-linked Canadian dollar (CAD) firmed against its weaker peers yesterday, thanks to an uptick in oil prices and strength in USD.
Oil price dynamics may drive CAD movement again today. Can oil sustain its upside and thereby lift the ‘loonie’?
Australian dollar (AUD) firms on China stimulus speculation
The Australian dollar (AUD) found some support last night, as softer economic data from China increased pressure on Beijing to introduce more stimulus measures.
New Zealand dollar (NZD) muted despite positive PMI
The New Zealand dollar (NZD) was subdued overnight, with the ‘kiwi’ failing to gain ground despite the New Zealand manufacturing PMI unexpectedly showing a return to expansion in July.
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