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The pound (GBP) fell sharply at the start of yesterday's session, striking weekly lows against some peers, as softer-than-forecast UK inflation increased the odds of a Bank of England (BoE) interest rate cut in December.
Headline inflation held at 3.8% for the third consecutive month in September, rather than rising to 4% as forecast, suggesting inflation has peaked and opening the door to another rate cut before the end of the year.
New data from the Confederation of British Industry (CBI) could influence the pound today. The business optimism index is set to have declined in the fourth quarter, while industrial orders are also set to fall in October. This could dent GBP if the data meets expectations.
Euro (EUR) struggles as USD rises
The euro (EUR) was subdued yesterday as the common currency lacked support in the absence of impactful Eurozone data.
This left EUR exposed to its negative correlation with the US dollar (USD), with the euro weakening as the American 'greenback' gained ground.
Today, EUR investors may be focused on the Eurozone's latest consumer confidence index. With household morale forecast to have deteriorated in October, the euro could struggle.
US dollar (USD) ticks higher amid souring mood
The US dollar gained ground yesterday, with the safe-haven currency benefitting from a broadly risk-off market mood.
Recent concerns about the health of the global economy and speculation of an AI bubble weighed on investor sentiment.
American economic data remains thin on the ground today, leaving the US dollar to trade on wider market trends such as risk appetite and US-China trade developments.
Canadian dollar (CAD) firms as crude prices climb
The crude-linked Canadian dollar (CAD) firmed yesterday as rising oil prices lifted the currency.
Canada's latest retail sales figures are the focus for CAD investors today. Sales growth is expected to have slowed from 1% to 0.5%, which could put some pressure on the 'loonie'.
Australian dollar (AUD) buoyed by upbeat mood
The Australian dollar (AUD) trended higher overnight as an improving market mood supported the 'Aussie'.
New Zealand dollar (NZD) undermined by public sector strike
The New Zealand dollar (NZD) failed to take advantage of the risk-on market mood overnight, as public sector workers walked off the job in one of New Zealand's largest-ever strikes.
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