Pound (GBP) rangebound amid lack of data
The pound (GBP) was left to trade sideways on Friday in the absence of any notable UK economic data.
GBP investors also appeared reluctant to place any aggressive bets on Sterling amid uncertainty over the Bank of England’s (BoE) upcoming interest rate decision
UK economic releases are in short supply at the start of this week, which may leave the pound without direction again today.
Euro (EUR) undermined by lacklustre German data
The euro (EUR) faced headwinds at the end of last week after Germany’s latest consumer price index reported a surprise cooling of inflation last month.
This was compounded by German retail sales release earlier on Friday, which revealed an alarming slump in consumer spending at the end of last year.
Today sees the publication of the CPI figures for the Eurozone as a whole. If the bloc’s preliminary CPI figures for January also fall short of expectations it’s likely to drag on EUR.
US dollar (USD) firms on Trump tariff threat
The US dollar (USD) closed last week’s session on strong footing, with the currency initially firming as President Trump reaffirmed his plans to impose tariffs on Mexico and Canada from Saturday.
These gains were then reinforced by the latest core PCE price index, as the Federal Reserve’s preferred indicator for inflation remained stubbornly high in December.
Coming up, the release of the latest ISM manufacturing PMI may act as a headwind for the US dollar later today as January’s index is expected to report the US factory sector remained in contraction last month.
Canadian dollar (CAD) struggles on mixed GDP figures
Trade in the Canadian dollar (CAD) was uneven on Friday in response to mixed domestic GDP figures, which reported a larger-than-expected contraction of growth in November, before rebounding at a healthy pace in December.
Looking ahead, the ‘loonie’ faces significant headwinds at the start of this week after Trump imposed 25% tariffs on Canadian goods over the weekend.
Australian dollar (AUD) pressured by Trump tariff concerns
The Australian dollar (AUD) retreated through Monday’s Asian trading session as the implementation of Trump’s tariffs rattled markets and weakened risk appetite.
New Zealand dollar (NZD) slides in risk-off trade
The New Zealand dollar (NZD) also trended lower in overnight trade as it was pressured by the deteriorating market mood.
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