Pound (GBP) uncertain amid mixed BoE comments
The pound (GBP) was uncertain yesterday as a lack of UK economic data left Sterling to trade without a clear direction.
Meanwhile, mixed comments from Bank of England (BoE) policymaker Catherine Mann also had an influence. While Mann said she was ready for ‘larger, more rapid Bank Rate cuts’ if needed, she also said that there was currently a greater risk of persistent inflation.
Looking ahead, the latest distributive trades survey from the Confederation of British Industry (CBI) could dent GBP today, if it shows another decline in retail sales volumes this month.
Euro (EUR) buoyed by weaker USD
The euro (EUR) ticked higher yesterday, recovering some of Monday’s losses, with the currency benefitting from its negative trading relationship with the US dollar (USD).
Additionally, a risk-off mood supported the safer euro against many of its riskier rivals.
Turning to today, EUR could face headwinds after Germany’s latest consumer confidence index showed a larger-than-forecast deterioration in morale heading into September.
US dollar (USD) dented by Fed independence concerns
The US dollar weakened yesterday after US President Donald Trump ordered the removal of Federal Reserve Governor Lisa Cook, fuelling fears about the risks to the US central bank’s independence.
The ‘greenback’ was spared further losses later in the session thanks to better-than-expected US data, with durable goods orders and consumer confidence both printing higher than expected.
With US data in short supply today, market risk appetite and Trump-Fed tensions could drive USD movement.
Canadian dollar (CAD) unclear amid positive data and weaker oil
The Canadian dollar (CAD) was mixed yesterday, as far stronger-than-forecast Canadian manufacturing and wholesale sales helped to offset the negative impacts of falling oil prices and a softer US dollar.
Oil price dynamics could drive CAD exchange rates today. If crude extends its downside, the ‘loonie’ could also weaken.
Australian dollar (AUD) unable to hold post-inflation gains
The Australian dollar (AUD) enjoyed a brief upside overnight after Australia’s monthly CPI indicator showed a sharp rise in inflation in July. However, a risk-off mood saw AUD shed its initial gains.
New Zealand dollar (NZD) softens amid souring mood
The New Zealand dollar (NZD) trended broadly lower overnight as a cautious mood dampened the risk-sensitive currency’s appeal.
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