Pound (GBP) mixed amid lack of data
The pound (GBP) traded without a clear direction on Friday as a lack of UK economic data left Sterling without a clear trajectory.
GBP was then caught up in the volatility surrounding Fed Chair Powell’s speech, with Sterling rallying against some peers and slipping against riskier rivals.
Coming back from quiet trade over the bank holiday, a speech from Bank of England (BoE) policymaker Catherine Mann this evening could impact the pound. Hawkish remarks could lift GBP.
Euro (EUR) rebounds as USD slumps
The euro (EUR) initially weakened on Friday as Russia-Ukraine tensions flared, undermining recent hopes that the two sides could work towards a peace deal.
However, the single currency was able to recoup these losses later in the session thanks to a sharp downturn in the US dollar (USD), with which the euro is negatively correlated.
So far this week the euro has faced pressure amid political uncertainty in France, with the deeply divided National Assembly likely to oust Prime Minister François Bayrou in a confidence vote next month. These concerns could continue to pressure EUR today.
US dollar (USD) plunges as Fed Chair hints at rate cut
The US dollar was muted through much of Friday’s session as markets braced for Fed Chair Jerome Powell’s Jackson Hole speech.
The ‘greenback’ then plummeted as US markets opened, with participants expecting a dovish tone from the Fed chief. Powell hinted at a possible rate cut during his speech, keeping the US dollar on the back foot.
The US dollar has managed to recoup some of those losses this week, despite concerns about US President Donald Trump’s attempt to fire Fed Governor Lisa Cook. Later today, an expected decline in durable goods orders could weigh on USD.
Canadian dollar (CAD) undermined by USD correlation
The crude-linked Canadian dollar (CAD) enjoyed a slight uptick on Friday thanks to rising oil prices. However, CAD then slumped in the evening due to its positive trading relationship with the US dollar.
With Canadian economic data in short supply today, CAD could trade in tandem with oil prices. Could softening oil prices dent the Canadian dollar?
Australian dollar (AUD) subdued following RBA minutes
The Australian dollar (AUD) was muted overnight in response to the Reserve Bank of Australia’s (RBA) latest meeting minutes. Although policymakers believe more rate cuts are likely needed, they are also unsure of the pace of policy loosening and will remain data-dependent.
New Zealand dollar (NZD) pressured amid risk-off mood
The New Zealand dollar (NZD) softened slightly overnight as a cautious market mood dampened the appeal of the risk-sensitive ‘kiwi’.
Never miss a movement. Create a free account with Currencies Direct to get the latest currency news delivered straight to your inbox. You can also set up rate alerts and check live rates 24/7.
