This morning, the US dollar is slipping back, but still remains in the driving seat after Friday’s rally. Friday saw a surge in interest for the dollar on better than expected Payroll data and bond yields. Speculation is now turning to the next rate hike as stock markets tumble.
The AUD/USD is one of the top performers after gapping lower at the open. The Aussie has some way to go to recover Friday’s losses though and indeed to regain the highs from just five days ago. The NZD/USD is performing better this morning, recovering from more moderate falls.
The GBP/USD is lagging this morning, with the EUR/GBP rallying for the third day in a row as the Brexit mood music turns sour. The EUR/USD saw relatively small losses Friday, putting the pair within a day’s session of the highs.
The yen pairs are mixed with some such as the AUD/JPY having to attempt a recovery for a deep gap lower. The USD/JPY is lower after rallying for the last three days.
The USD/CAD is slipping back after pair saw its biggest rally of 2018 Friday.
Today, we have UK services PMI at 09.30.
At 15.00, we get US ISM non manufacturing PMI.
ECB President Draghi speaks at 16.00.
The pound has lost its latest Brexit confidence shine as Tory in-fighting and a tough European stance send the EUR/GBP higher.
With mounting pressure on Theresa May, the risks are skewed to the upside rather than the downside right now.