The pound is sliding back down again this morning following yesterday’s bounce on July’s strong retail sales growth results. While investors are slightly more optimistic on the post-Brexit UK economy after this month’s better-than-expected inflation, jobless claims, and retail sales results, economists still expect weaker growth in the second half of 2016. Markets are also pricing in a 36% chance that the Bank of England will cut interest rates by the end of the year, which is holding the pound down today.
Nearby, the euro is trading lower against a strengthening US dollar despite Germany’s producer inflation data from July coming out stronger than analysts anticipated.
Across the pond, the US dollar is strengthening against all major currencies as investors become more optimistic that the Federal Reserve could raise interest rates this year. Former Fed Chairman Alan Greenspan may have fueled this sentiment with his comments yesterday on how he believes low rates won’t last “very much longer” and that rates could rise rapidly.
The Canadian Dollar is tumbling after Canada’s retail sales results for June missed forecasts. The Aussie dollar is down with no new data out, partially because of the stronger US dollar.
EURUSD: The euro is trading lower against a stronger US dollar despite Germany’s upbeat producer inflation growth.
GBPUSD: The pound is sliding again as investors remain bearish for the UK economy for the second half of 2016.
AUDUSD: The Aussie dollar is down partially because of a stronger US dollar.
USDCAD: The Canadian dollar is down after retail sales for June disappoint.