Following a higher-than-expected report on British public borrowing, the pound (GBP) lost ground to its more powerful competitors yesterday.
In October, government borrowing jumped to £17.4 billion, which was above the £12.3 billion anticipated and the second-highest October borrowing on record. This sparked concerns about the UK's financial situation.
Sterling is facing selling pressure again today. UK retail sales contracted more than expected in October, while the UK’s PMIs are forecast to report muted growth.
The euro (EUR) struggled yesterday as ongoing fears around the Russia-Ukraine war weighed on the common currency.
However, a pullback in the US dollar (USD) later in the afternoon helped cushion the euro, due to EUR’s strong negative correlation with USD.
Today, the Eurozone’s latest PMI results are the focus for EUR investors. Could sluggish growth in the bloc see EUR stumble?
The US dollar wavered yesterday as a shifting market mood left the safe-haven currency without a clear trajectory.
A slight decline in US Treasury yields put pressure on the ‘greenback’, seeing it weaken against some of its counterparts.
This afternoon, the US PMIs are due to be published. Although not as impactful as the ISM releases, the S&P PMIs could boost USD if they reveal another expansion in American service sector activity.
The crude-linked Canadian dollar (CAD) climbed yesterday amid rising oil prices. An unexpectedly large acceleration in Canadian producer price growth also helped to boost CAD.
Later today, Canada’s September retail sales figures could impact the ‘loonie’. Will another 0.4% increase in sales growth lift the Canadian dollar?
The Australian dollar (AUD) was volatile overnight, dropping amid risk-off trade before rebounding on strong commodity prices.
The New Zealand dollar (NZD) fared worse than the ‘Aussie’ overnight, as the dovish outlook for the Reserve Bank of New Zealand (RBNZ) pressured the ‘kiwi’.
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