Pound (GBP) Rebounds amid BoE Bets
The Pound (GBP) enjoyed renewed support on Friday, with the UK currency managing to recoup some of its losses from earlier in the week.
Sterling’s upside came as UK government bond yields rose to a seven-month high, indicating rising expectations for more Bank of England (BoE) interest rate hikes.
This week starts slowly for the Pound, with a lack of data potentially limiting movement. As the session progresses, multiple high-impact UK releases could spark GBP volatility.
Euro (EUR) Buoyed by Hawkish ECB Comments
Hawkish comments from European Central Bank (ECB) policymakers boosted the Euro (EUR) at the end of last week.
ECB President Christine Lagarde said the bank would be ‘courageous’ in its battle to bring down inflation, while rate setter Isabel Schnabel said the ECB would act ‘with determination’.
This afternoon, the single currency could climb if the latest Eurozone consumer confidence score improves as expected.
US Dollar (USD) Weakens as Market Mood Improves
The US Dollar (USD) retreated on Friday, suffering profit-taking after hitting multi-month highs. A positive market mood also weighed on the safe-haven currency.
Comments from Federal Reserve Chair Jerome Powell compounded USD’s losses in the afternoon. Powell suggested that rates may not need to rise as high as anticipated, which saw markets rein in their expectations for another hike next month.
More Fed policymakers are due to speak today. If they echo Powell’s comments, USD could slide.
Canadian Dollar (CAD) Tumbles as Retail Sales Contract
The Canadian Dollar (CAD) dropped on Friday following a slump in Canada’s latest retail sales figures. CAD’s positive correlation with USD added to the currency’s downside.
Amid an absence of Canadian data today, oil prices could drive movement in the crude-linked ‘Loonie’.
Australian Dollar (AUD) Ticks Lower as Risk Appetite Wanes
The Australian Dollar (AUD) softened in overnight trade as a souring market mood dented the risk-sensitive ‘Aussie’. Markets remain skittish over the US debt ceiling crisis.
New Zealand Dollar (NZD) Propped Up by RBNZ Bets
The New Zealand Dollar (NZD) wavered last night as Reserve Bank of New Zealand (RBNZ) rate hike bets underpinned the currency, preventing losses amid a risk-off tone in markets.
Source : Torfx
