Euro mixed despite ECB rate cut

Pound (GBP) softens in absence of data

The pound (GBP) struggled yesterday as a lull in UK economic data left the British currency lacking support.

This left investors to dwell on the many concerns around the trajectory of the UK economy, leading to losses for the pound.

Sterling is facing fresh headwinds today in the wake of the UK’s latest GDP figures. The British economy contracted for a second consecutive month in October, further fuelling GBP investors’ fears.

Euro (EUR) volatile following ECB policy decision

The euro (EUR) was volatile yesterday amid the European Central Bank’s (ECB) final interest rate decision of 2024.

The ECB cut rates by 25bps, as expected, while also signalling that further cuts are likely in the new year. However, the common currency traded in a wide range following the announcement, even rising against its weaker peers.

Softer-than-expected German trade figures are putting some pressure on the euro this morning. Could a forecast contraction in Eurozone industrial production later on further undermine EUR?

US dollar (USD) firms following hotter PPI

The US dollar (USD) gained ground yesterday after the US producer price index for November exceeded expectations, pointing to persistent inflationary pressures in America.

This, paired with Wednesday’s uptick in consumer price inflation, saw markets trim their expectations for Federal Reserve interest rate cuts.

With impactful US economic data thin on the ground today, the US dollar could trade primarily on market risk appetite.

Canadian dollar (CAD) uncertain amid choppy oil prices

The crude-linked Canadian dollar (CAD) wavered yesterday as uncertainty in the oil market infused CAD with volatility.

Canadian economic data is in short supply today, potentially leaving the ‘loonie’ to trade on oil price dynamics.

Australian dollar (AUD) steady in absence of data

The Australian dollar (AUD) wavered mostly sideways overnight amid a lack of Australian data and a cautious market mood.

New Zealand dollar (NZD) flat despite PMI miss

The New Zealand dollar (NZD) was also muted overnight, with the ‘kiwi’ avoiding losses despite a weaker-than-expected manufacturing PMI.