Weekly Round-Up & The Week Ahead

Weekly round-up and a look at the week ahead for EUR, GBP, and USD.

DAILY ANALYSIS

USD

Whilst the USD remained relatively unchanged last week, trading in tighter ranges, the greenback is expected to come under some pressure again with market expectations of an imminent rate cut by the Fed along with concerns over the Fed’s independence. Today US markets are closed for Labor Day, so volumes will be lighter than normal before normal conditions later in the week.

Data wise this week, we have ISM Manufacturing and Services PMIs, along with The Federal Reserve's "Beige Book" which will be closely watched for evidence on the state of the economy and whether any developments can impact the Fed’s decision making.

EUR

EURUSD is back above the 1.17 this morning mainly in response to the weakening dollar. Tomorrow’s Flash Inflation Rate release will be a key data event for markets with any shifts in inflationary trends likely to dictate any changes to the ECB’s monetary policy.

GBP

GBPUSD followed the wider trend of tight ranges last week but overall sterling faced some selling pressures spending much of that time in the low 1.34 territory. However this morning, we’ve already seen GBPUSD back above 1.35 matching the wider dollar weakness trend. Sterling was a bigger loser versus the single currency with EURGBP hitting highs of .8670 (GBPEUR 1.1534) at one point.

The UK economic calendar is very light this week, but a speech from Bank of England policymaker Catherine Mann coupled with Retail Sales on Friday could provide some insight into future policy decisions.

Daily Rates

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