Previous Day's Market Highlights
Sterling came under renewed pressure yesterday as the UK’s political situation remained uncertain following a hung parliament result in Thursday’s election. The Conservatives are looking to form a coalition government with Northern Ireland’s Democratic Unionist Party.
Sterling-dollar fell back below 1.2700 and sterling-euro below 1.1400. Euro-dollar met resistance just above 1.1233, before falling back below 1.1200.
Sterling hit new lows against the Canadian dollar since the announcement of the snap election in mid-April. The loonie rallied further on hawkish comments from BoC Senior Deputy Governor Carolyn Wilkins. Wilkins said the BoC would consider whether all monetary stimulus is still necessary given economic growth.
Sterling-Aussie is also trading around its lowest levels since the announcement of the snap elections. Sterling is trading around its lowest levels against the kiwi dollar since mid-March.
|Currency Pairing||08:00 Today||Vs 08:00 Yesterday||Four-Week High||Four-Week Low||% Change|
|GBP / EUR||1.1324||1.1760||1.1277||4.11%|
|GBP / USD||1.2676||1.3048||1.2635||3.17%|
|EUR / USD||1.1194||1.1283||1.0976||2.72%|
|GBP / NZD||1.7561||1.8899||1.7497||7.42%|
|GBP / CAD||1.6842||1.7822||1.6796||5.76%|
Today's Market Highlights
The pound will remain in focus today with the release of May inflation (09:30 BST). Last month, the pound fell as annual CPI rose to 2.7% amidst concerns over the pace of wage growth. Inflation is expected to remain flat, with core inflation slowing. Political uncertainty remains a downside risk.
Gains in Economic Sentiment (10:00 BST) in Germany and the Eurozone could offer the euro support. The euro strengthened at the start of the week after polls showed support for President Emmanuel Macron’s party in the first round of France’s parliamentary elections.
US PPI, an indicator of inflation, will be closely watched (13:30 BST) amidst concerns over recent softer inflation signals ahead of Wednesday’s interest rate decision. While a rate hike is expected on Wednesday, markets will be watching to see what tone the Fed strikes on inflation and interest rates going forward.
Today's Economic Calendar
|09:30||GBP||Core Consumer Price Index YoY (May)||2.3%||2.4%|
|09:30||GBP||Consumer Price Index YoY (May)||2.7%||2.7%|
|10:00||EUR||German ZEW Economic Sentiment (Jun)||21.8||20.6|
|10:00||EUR||Eurozone ZEW Economic Sentiment (Jun)||37.2||35.1|
|13:30||USD||Core Producer Price Index YoY (May)||2.0%||1.9%|
|13:30||USD||Producer Price Index YoY (May)||2.4%||2.5%|
|23:45||NZD||Current Account QoQ (Q1)||$1.000B||$-2.335B|