GBP, EUR, USD flat in the calm before the storm

Philip McHugh September 19th 2023 - 2 minute read

Movement in the currency market was limited on Monday as markets braced for some high-impact events later in the week.

The pound continues to trade sideways this morning, with GBP/EUR stable at €1.1590 and GBP/USD flat at $1.2379. GBP/CAD is rangebound at CA$1.6675, while GBP/AUD and GBP/NZD hold steady at AU$1.9239 and NZ$2.0902, respectively.

Coming up, will comments from the European Central Bank’s (ECB) Frank Elderson inspire some movement in the euro later this afternoon?

What’s been happening?

This week got off to a slow start in terms of currency movement, with most investors erring on the side of caution in advance of some key data releases later in the session.

The only events of note yesterday were a couple of European Central Bank speeches. However, conflicting messages from policymaker Peter Kazmir and Vice President Luis de Guindos resulted in the euro remaining trapped in a narrow range.

In the UK, ongoing economic gloom continued to limit demand for the pound, particularly ahead of the Bank of England’s (BoE) latest interest rate decision.

Meanwhile, the US dollar was left rangebound in the face of limited data and a mixed market mood.

What’s coming up?

Looking ahead, the only notable event on today’s data calendar will be a speech by a member of the ECB’s executive board, Frank Elderson.

While Elderson does not set monetary policy, his comments may still be closely watched by EUR investors amid some lingering uncertainties over whether the ECB could raise interest rates again.

Meanwhile, movement in the US dollar is likely to remain extremely limited today, with USD investors reluctant to reposition ahead of the Federal Reserve’s interest rate decision on Wednesday.

The pound is also likely to be in a similar situation today, with GBP investors wary of making any moves ahead of the BoE’s own rate decision and the publication of a potentially key UK inflation release.

Written by
Philip McHugh

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