Pound (GBP) wavers in absence of data
Trade in the pound (GBP) was mixed at the end of last week’s session as the continued absence of any meaningful UK data left Sterling to be driven by broader FX trends.
This resulted in the pound accelerating against more risk-sensitive currencies, while dipping against its more resilient peers.
UK data remains in short supply at the start of this week, which may leave Sterling at the mercy of wider market movement.
Euro (EUR) dented by underwhelming data
The euro (EUR) struggled on Friday, initially coming under pressure after Germany’s latest trade figures reported a shock contraction in exports in November.
EUR sentiment then remained subdued as subsequent data showed that Eurozone retail sales also slowed over the same period.
Looking ahead, movement in the single currency may be limited today, with EUR investors erring on the side of caution ahead of talks between the US and Denmark regarding the future of Greenland.
US dollar (USD) firms as unemployment falls
The US dollar (USD) appreciated at the end of last week as USD investors digested the latest US non-farm payroll report.
While December’s data reported a slowdown in US job creation, the data also reported that unemployment unexpectedly fell to 4.4%, which appeared to temper dovish Federal Reserve bets and boost USD demand.
Turning to the start of this week, the US dollar is shedding these gains as the future independence of the Fed is once again in question, after the US Department of Justice launched a criminal investigation against Fed Chair Jerome Powell, who claimed in a statement that the case is politically motivated.
Canadian dollar (CAD) undermined by rising unemployment
The Canadian dollar (CAD) stumbled on Friday as CAD investors were dismayed by a larger-than-expected increase in domestic unemployment last month.
Looking ahead, the ‘loonie’ may be able to bounce back at the start of this week if we see oil prices continue to appreciate.
Australian dollar (AUD) buoyed by USD weakness
The Australian dollar (AUD) attracted modest support through Monday’s Asian trading session, as the drop in the US dollar helped to boost market risk appetite.
New Zealand dollar (NZD) firms in risk-positive trade
The New Zealand dollar (NZD) also firmed in overnight trade amid the positive shift in investor risk sentiment.
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