Pound Sterling

Pound (GBP) Falls as England Lifts Lockdown Restrictions

Pound News: Concerns Over Easing of Lockdown Restrictions Haunt UK Markets 

The Pound (GBP) struggled today despite England lifting lockdown restrictions amid surging daily Covid-19 infections. Prime Minister Boris Johnson also urged caution as a sudden flare-up in hospitalisations or deaths from the virus could see the country re-enter lockdown. 

Jim Reid, an analyst at Deutsche Bank, said: 

‘[T]he world will be watching the U.K. experiment with huge interest. It could show a pathway back towards normality or it could be a warning to even heavily vaccinated countries that Covid will be a problem for a decent length of time still.’ 

Labour leader Keir Starmer also criticised Downing Street’s decision to lift restrictions, warning of a ‘summer of chaos’. 

In absence of any market-moving UK economic data tomorrow, Pound investors are likely to continue to focus on domestic coronavirus developments. 

Euro News: EUR Rises on Sliding Demand for USD  

The Euro (EUR) rose today due to falling demand for the US Dollar – the single currency’s major competitor – following a week of disappointing US economic data. 

Last week’s below consensus Eurozone trade balance data revealed, however, that the seasonally-adjusted trade surplus dipped to €9.3 billion in May, down from the upwardly revised figure of €13.4 billion in April. This has dented confidence in the bloc’s economy. 

Could more underwhelming Eurozone economic data this week weaken demand for the single currency? 

US Dollar News: USD Fluctuates on Souring Risk Sentiment 

The US Dollar (USD) fluctuated today on a mixture of souring risk sentiment, buoying demand for the safe-haven currency, and concerns about the outlook for the US economy. 

Last week’s lacklustre US economic data has however weighed on confidence in the US economy, with retail sales in June showing larger declines than estimates. 

Looking ahead, we could see demand for the safe-haven ‘Greenback’ head higher if risk sentiment deteriorates.  

Canadian Dollar News: CAD Falls as Oil Prices Remain Subdued 

The commodity-correlated Canadian Dollar (CAD) remained relatively subdued at the beginning of this week’s session with oil prices being subdued following OPEC+’s announcement of increasing its production.  

In the absence of Canadian economic data, the ‘Loonie’ will continue to be driven by the price of oil tomorrow.  

Australian Dollar News: ‘Aussie’ Falls as Risk Sentiment Sours on US-China Tensions 

The risk-sensitive Australian Dollar was driven down by souring risk-sentiment today. US-China tensions have flared once again, which alongside the general souring of market sentiment, has weakened demand for risk-correlated currencies.  

Data Releases 

10:00 EU Construction Output (May) 

11:00 UK BoE Haskel Speech 

11:00 GER German Buba Monthly Report 

15:00 US NAHB Housing Market Index (Jul)