Pound News: Sterling Sustains Recovery ahead of BoE Policy Decision
The Pound is continuing to make a recovery this week on hopes that the UK government’s controversial Brexit plans will not succeed and a bullish mood, with some analysts suggesting the Pound was oversold last week.
Sterling’s gains are limited, but it is finding some support in this as well as today’s stronger-than-expected UK inflation data that came in at 0.2%, up from the 0% forecast.
The Bank of England (BoE) holds its September policy decision tomorrow, in what is likely to be one of the week’s most influential events for the volatile Pound. If the BoE is more dovish, the Pound could see even further losses.
Euro News: Euro Weakens on Eurozone Coronavirus Restrictions
The Euro slipped against its peers today, although EUR is holding steady against a weak US Dollar ahead of the Federal Reserve’s key September policy decision.
Added to this, EUR exchange rates continue to remain sensitive to the new restrictions and rising coronavirus cases across Europe.
Tomorrow will see the publication of the Eurozone’s August inflation rate report. However, the Euro may be even more likely to be driven by reaction to the Federal Reserve policy decision throughout tomorrow.
US Dollar News: Federal Reserve Uncertainty Weighing on US Currency
The US Dollar is struggling today ahead of the Federal Reserve Interest Rate Decision over concerns the Fed could become more dovish on the US economic outlook
USD investors will be looking for insight into how the bank’s new inflation targets may influence future monetary policy.
US Dollar movement will be focused on the tone the Fed takes this evening. If the bank takes a more dovish stance on the US outlook and hints at further monetary easing, the US Dollar’s recent weakness is likely to persist.
Canadian Dollar News: CAD Weaker after Disappointing Manufacturing Report
Canada’s July manufacturing sales report published yesterday came in notably lower-than-forecast at 7%.
Consequently, the Canadian Dollar fell against the Pound, although its losses were slowed by some resilience in oil price recovery.
Canadian inflation rate data today and ADP employment change data tomorrow could drive CAD exchange rates. Shifts in oil prices, and market risk and trade sentiment could also cause some Canadian Dollar movement.
Australian Dollar News: ‘Aussie’ Appealing amid Hopes for Australian Lockdown Easing
Fresh hopes that Australia’s State of Victoria could see parts of its lockdown relaxed by the end of the month have led to stronger Australian Dollar demand.
Added to this, the market risk-on tone has boosted the ‘Aussie’ on positive reports of a coronavirus vaccine.
Federal Reserve reaction could drive market sentiment, and in turn Australian Dollar. However, tomorrow’s Australian job market report will be the most influential Australian dataset this week and will be closely watched by AUD investors.
Thursday, 17th September
02:30 Australian Job Market Report
10:00 Eurozone Inflation Rate
12:00 Bank of England Policy Decision
13:30 Canadian ADP Employment Change
13:30 US Building Permits and Housing Starts