Pound News: Brexit Jitters Persist Despite Rising Bank of England (BoE) Interest Rate Hike Bets
Bank of England (BoE) interest rate hike bets rose following the publication of Markit’s June UK PMI results, and investors became even more confident in the chances of an August BoE interest rate hike following optimistic comments from BoE Governor Mark Carney on Thursday.
However, the Pound’s strength was limited throughout Thursday’s European session as investors focused on the latest warnings from businesses about the potential impact of a ‘no deal’ Brexit on UK jobs. News that JPMorgan would begin to move staff from London to continental EU in the coming months weighed especially heavily on the Pound.
Sterling is unlikely to be particularly influenced by UK labour productivity data today, and investors will likely remain focused on Brexit uncertainties and developments.
Euro News: German Factory Orders Help Euro Hold Ground
Demand for the Euro has been mixed so far this week, but the shared currency is finding increasing support in Eurozone data.
Following the solid Eurozone services PMI data earlier in the week, the Euro was bolstered by German factory orders data and Eurozone retail PMI stats on Thursday.
Germany’s May industrial production and France’s May trade balance results will be published today, but the Euro may be more influenced by the strength of the US Dollar (USD) towards the end of the week.
US Dollar News: USD Driven by Key US Data and Non-Farm Payroll Anticipation
A slew of US data was published on Wednesday which helped the US Dollar to push GBP/USD back down from its weekly highs.
USD demand was limited by a disappointing ADP job change report, but ISM’s non-manufacturing PMI beat forecasts and helped the US currency hold its ground ahead of the Federal Reserve meeting minutes report.
Today’s US Dollar movement is likely to be influenced by market reaction to the Fed minutes, as well as the US Non-Farm Payroll report due for publication in the afternoon.
Canadian Dollar News: CAD Recovers Losses despite Persistent Trade Jitters
Due to market concerns about how the Brexit process may impact UK and EU businesses, the Pound to Canadian Dollar exchange rate shed its weekly gains on Thursday and trended closer to the week’s opening levels again.
This was despite weaker prices of oil, Canada’s most lucrative commodity, and ongoing concerns about how the US government’s escalating trade protectionism could affect Canada’s economy.
CAD gained on Pound weakness on Thursday, but today GBP/CAD is likely to be influenced by the afternoon’s highly anticipated Canadian trade and job market results.
Australian Dollar News: AUD Struggling amid Trade Jitters
The Australian Dollar failed to push a weak Pound much lower on Thursday, as investors remained hesitant to buy risky trade-correlated currencies like the Australian Dollar.
Demand for the Australian Dollar has been under pressure due to concerns that a trade war could break out between the US and China, particularly as China is Australia’s biggest trade partner.
AUD will be driven by trade developments today, but any surprising reaction to AiG’s Australian construction PMI from June could also inspire movement.
Friday, 6th July
07:00 German Industrial Production
07:45 French Trade Balance
13:30 Canadian Trade Balance
13:30 Canadian Job Market Report
13:30 US Non-Farm Payrolls Report
15:00 Canadian Ivey PMI