GBP/USD
A fresh new week and the Pound continues to climb against the Buck, now making for its 4th consecutive day of upwards movement. This comes as the Pound has finally found its footing against the Dollar, having previously plummeted all the way down to multiyear lows. This upwards shift by the Pound is however experiencing fierce headwinds as the Greenback shows its reluctance to fall. With the recent lack of data in the markets, investors are now looking ahead at the events that are to come throughout this week. As it currently stands, many are anticipating an array of speeches from both the Bank of England and Federal Reserve on Wednesday. In this investors will play close attention to any clues that the members may give regarding their future approach to interest rate hikes. Until then, both the Pound and Dollar will not have much to go on due to the lack of data for the start of this week. On the contrary, the Dollar is currently finding itself under a degree of pressure as recessionary fears for the U.S. economy continue to increase. These fears are predominantly going off the recent decrease in consumer confidence levels over in the States, hinting at a potential decline in economic growth. The Pound, on the other hand, is also not yet in the clear as it also battles with the negative outlook for the British economy.
GBP/EUR
To kick of trading this week, the Pound has already begun to climb against the Euro slightly in a bid to erase the losses it experienced at the end of last week. Despite the Pound still finding itself quite low against the Euro, it has held up reasonably well considering the series of disappointing UK economic data releases we have seen this month. These data releases highlighted the current struggle for the UK economy, with investors peeling back their rate hike expectations for the Bank of England as a result. However, the lack of economic data from the UK last week has allowed the Pound a chance to climb in the market. The Euro, on the other hand, is currently under pressure as it finds itself in a similar position to the Pound. Recent economic data from Germany has showed a gradual decline in certain areas of their economy, causing investors to reduce their expectations for the European Central Bank to raise interest rates. As for trading today, the pair is not expected to print much movement and will likely find itself mainly influenced by overall market sentiment.
Morning Update published by Frank Brightman (27/06/2022)