Pound (GBP) muted as markets shrug off UK inflation uptick
The pound (GBP) was mostly rangebound on Wednesday, despite the UK’s consumer price index reporting a surprise uptick in inflation last month.
The muted response from GBP investors was likely driven by the perceived risks of today’s jobs report, amid the Bank of England’s (BoE) increased focus on the UK’s labour market.
So far, the response to May’s jobs data has been broadly positive. While unemployment ticked higher, a surprise increase in employment growth is helping underpin Sterling this morning.
Euro (EUR) dented by French political risks
The euro (EUR) trended lower on Wednesday as renewed political jitters in France pressured the single currency.
The government’s upcoming budget could lead to a vote of no confidence in the Prime Minister amid significant opposition to a proposed scrapping of two public holidays to help tackle the public deficit.
The Eurozone will publish its latest inflation data later today, but unless June’s finalised figures deviate from the preliminary reading, it may have a minimal impact on the euro.
US dollar (USD) slumps amid Fed independence concerns
The US dollar (USD) came under significant selling pressure during yesterday’s session amid fresh concern over Federal Reserve Chair Jerome Powell’s future.
Fears over the independence of the US central bank resurfaced following reports that US President Donald Trump is discussing potentially firing Powell before his term is up.
Coming up, the latest US retail sales print could provide a boost to USD exchange rates later today as June’s figures are expected to report a rebound in sales growth.
Canadian dollar (CAD) subdued amid sliding oil prices
The Canadian dollar (CAD) struggled to attract support on Wednesday as softer oil prices suppressed the commodity-linked currency.
If the oil market selloff persists, the ‘loonie’ will likely face additional headwinds today.
Australian dollar (AUD) slumps on abysmal jobs data
The Australian dollar (AUD) retreated overnight on Wednesday as another weak domestic jobs report stoked bets for future interest rate cuts from the Reserve Bank of Australia (RBA).
New Zealand dollar (NZD) pressured by risk-off flows
The New Zealand dollar (NZD) also weakened in overnight trade amid a cautious market mood.
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