Pound (GBP) buoyed by improving productivity outlook
The pound (GBP) was able to attract modest support yesterday amid reports that UK productivity may not be as weak as official figures suggest.
Analysis from the Resolution Foundation thinktank suggests the UK pulled itself out of its productivity slump in recent years, which could help provide a firmer foundation for growth going forward.
UK data remains in limited supply today, likely leaving movement in the pound to be dictated by wider currency trends.
Euro (EUR) struggles in absence of data
The euro (EUR) was subdued on Monday as a lull in Eurozone data left the single currency struggling to attract support.
EUR sentiment was further undermined by the euro's strong negative correlation with the US dollar (USD) as the latter crept higher.
Coming up, the euro could receive a boost later today, if Germany's latest IFO survey reports that business sentiment continued to improve this month.
US dollar (USD) firms amid Iran sanction uncertainty
The US dollar ticked higher through the start of this week's session, allowing the 'greenback' to claw back a small portion of the previous week's losses.
Investors favoured the safe-haven currency as US Treasury Secretary Scott Bessent outlined new US economic sanctions on Iran.
The US dollar is likely to extend these gains today amid fresh trade uncertainty, after China – a major trade partner of Iran's – responded to the sanctions by claiming it 'would do what was necessary' to protect its interests.
Canadian dollar (CAD) tumbles as US slaps tariffs on Canada
The Canadian dollar (CAD) faced heavy selling pressure through Monday's session as Ottawa vowed to respond in kind to new US tariffs on Canadian goods.
Expect the 'loonie' to remain in the doldrums today amid concerns about the potential economic fallout from a US-Canada trade war.
Australian dollar (AUD) underpinned by hawkish RBA minutes
The Australian dollar (AUD) found fleeting support overnight on Monday as the minutes from the Reserve Bank of Australia's (RBA) latest policy meeting struck a hawkish tone.
New Zealand dollar (NZD) dented by risk-off flows
The New Zealand dollar (NZD) drifted lower in overnight trade as market risk appetite was pressured by fresh geopolitical uncertainty.
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