Pound Rangebound as UK Inflation Cools

Pound News: GBP muted as UK inflation slows 

The Pound (GBP) traded narrowly against the major currencies today following yesterday’s release of the UK’s latest unemployment rate report, which dipped from 4.8% to 4.7%.  

Today also saw the UK’s inflation data cool from 2.5% in June to 2% last month, with the headline rate expected to rise sharply in the coming months. 

UK house prices also rose at their fastest rate since 2004, according to the Office for National Statistics (ONS).  

However, with daily Covid-19 infection rates rising in the UK along with hospitalisations, Pound investors have remained largely cautious.  

Any further signs of rising daily infection rates would also drag down the Pound exchange rate later this week. 

Euro News: EUR Steady as Eurozone Inflation Beats Forecasts in July 

The Euro (EUR) held steady today following the release of July’s Eurozone inflation gauge, which rose to 2.2% in July from June’s 1.9%. The European Central Bank (ECB) also predicted a rise in the months ahead. 

However, global supply issues and rising Covid-19 infections throughout China and New Zealand have bolstered demand for the safe-haven single currency today. 

Looking ahead, Euro investors will continue to monitor coronavirus developments in Europe. Could rising daily infections and the threat of further lockdowns limit the Euro? 

US Dollar News: USD Edges Higher as Risk Sentiment Sours 

The US Dollar (USD) edged higher today as global risk sentiment has remained sour, which has seen demand for the safe-haven ‘Greenback’ increase over this week’s session. 

Also, USD investors are awaiting today’s release of the US Federal Reserve’s monetary policy minutes. Could a bullish Fed see the USD exchange rate head higher? 

US Dollar traders will be looking ahead to Thursday’s release of the latest initial jobless claims for the week ending August 14.  

Any signs of falling joblessness in America could see the ‘Greenback’ exchange rate begin to pick-up.  

Canadian Dollar News: CAD Rises Despite Falling Oil Prices 

The Canadian Dollar (CAD) clawed back some of its earlier losses this week despite falling oil prices limiting the appeal of the commodity-linked currency.  

In Canadian economic data, today saw the release of the latest inflation rate for July, which rose above consensus to 0.6%, while the year-on-year figure rose by 3.7% in its biggest jump in over a decade. 

Looking ahead, Thursday will see the release of the latest Canadian ADP employment change data for July. Could rising levels of unemployment in Canada drag down the ‘Loonie’ this week? 

Australian Dollar News: AUD Edges Higher as Risk Sentiment Makes Marginal Improvement 

The Australian Dollar (AUD) made modest gains today after risk sentiment improved marginally improved, buoying demand for the risk-sensitive ‘Aussie’. 

However, Australia’s strict zero-Covid-19 policy has left many AUD traders concerned about the impact on the nation’s economy in the months ahead. 

Upcoming Data 

02:00 AU Westpac Leading Index (Jul) 

02:30 AU Wage Price Index (Q2) 

07:00 UK Core Inflation Rate (Jul) 

07:00 UK Inflation Rate (Jul) 

10:00 EU Inflation Rate (Jul) 

01:00 US Housing Starts (Jul) 

07:00 US FOMC Minutes