Pound (GBP) subdued in absence of data
The pound (GBP) was subdued yesterday as a lack of UK data left the currency muted.
This saw Sterling slip against some of its stronger rivals, particularly amid ongoing concerns about coming tax hikes in the autumn budget.
British economic data remains thin on the ground as the week comes to a close, potentially leaving the pound rudderless once again.
Euro (EUR) firms as USD retreats
The euro (EUR) ticked higher against some of its peers yesterday, despite lacklustre Eurozone data, thanks to a pullback in the US dollar (USD).
However, the safer euro struggled against more risk-sensitive currencies as an upbeat market mood limited EUR demand.
A slump in German retail sales may undermine EUR today, while a rise in unemployed people might add to the pressure. However, an expected uptick in German inflation could help the currency claw back some losses this afternoon.
US dollar (USD) softens despite strong GDP
The US dollar weakened yesterday as a risk-on mood swept markets, depriving USD of safe-haven flows.
Upbeat US data only seemed to add to the cheery tone and pressure the ‘greenback’, with American GDP growth revised up for the second quarter.
All eyes are on the core PCE price index – the Federal Reserve’s preferred measure of inflation – during today’s session. The US dollar could attract support if prices rose in July.
Canadian dollar (CAD) choppy amid mixed factors
The crude-linked Canadian dollar (CAD) fluctuated yesterday as wavering oil prices, a weakening US dollar, and stronger-than-forecast Canadian wage growth all impacted the currency.
Today, the focus for CAD investors falls on Canada’s second-quarter GDP figures. Forecasters are anticipating a slowdown in growth in Q2, which could weigh on the ‘loonie’.
Australian dollar (AUD) buoyed by strong corporate borrowing
The Australian dollar (AUD) firmed after July data showed business credit surged 1.4%, the strongest in months. The sharp pickup signals robust corporate borrowing and adds to expectations the Reserve Bank of Australia (RBA) may keep policy tighter for longer.
New Zealand dollar (NZD) rises in tandem with AUD
The New Zealand dollar (NZD) also firmed last night, with NZD enjoying its positive correlation with AUD and an improvement in risk appetite.
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