GBP/USD jumps to near one-month high as Trump discharged from hospital

The US dollar trended lower at the start of this week as the news that President Donald Trump had been discharged from hospital on Monday fed into a USD selling bias.

Meanwhile, the pound is holding steady so far this morning, with GBP/EUR flat at €1.1026 and GBP/USD stable at $1.2984. GBP/CAD is trading narrowly at C$1.7229, while GBP/AUD and GBP/NZD tick up to AU$1.8160 and NZ$1.9582, respectively.

Coming up today, the focus will be on a speech by European Central Bank (ECB) President Christine Lagarde, who may hint at more monetary easing.
 

What’s been happening?

The US dollar tumbled on Monday, with demand for the safe-haven currency being undermined as Donald Trump was discharged from hospital.

The positive news regarding the President’s health helped to boost market risk sentiment, which overshadowed the release of a stronger-than-expected ISM Non-Manufacturing PMI.

This drop in the US dollar allowed the euro to shoot higher yesterday, thanks to the negative correlation in the pairing, with the single currency’s rally further bolstered by some impressive retail sales figures from the Eurozone in August.

Meanwhile, trade in the pound was mixed at the start of the week.

While GBP investors welcomed the news that Prime Minister Boris Johnson and EU Commission President Ursula von der Leyen had ‘agreed the importance’ of reaching a trade deal, this was offset by the latest UK services PMI as it highlighted the alarming pace at which the sector is shedding jobs.
 

What’s coming up?

Turning to today’s session, the spotlight looks to be on a speech by ECB President Christine Lagarde later in the day.

Her speech could exert some pressure on the euro this afternoon, if Lagarde drops any hints regarding any additional monetary easing.

In the meantime, however, the single currency could find some support this morning after Germany reported a stronger-than-expected rise in factory orders in August.

In the UK, GBP investors will be monitoring potential Brexit developments, whilst also keeping an eye on the latest UK construction PMI.

Finally, the focus for USD investors today will be on the latest JOLTs job opening figures as well as a speech by Federal Reserve Chair Jerome Powell.