Sterling trades in narrow ranges against the EUR and USD
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Daily Currency Update
UK Retail sales data exceeded expectations early on Friday with the May 2024 rising 2.9% following the 1.8% fall in April. This beat the 1.6% forecast, driven by most sectors which benefitted from the better weather. Alongside this we saw flash manufacturing and services PMI data in UK, Europe and the US. UK and European data came in under expectation but still peered over the 50.0 gauge showing expansion. The only exception to this was the flash manufacturing figure from Europe, which came in at a lowly 45.6. US data continued its recent good form, posting better than expected manufacturing and service data, and showing expansion in each industry. GBP/USD fell to a weekly low of 1.2625 early evening on Friday and EUR/USD spent most of Friday recovering from an early dip down to 1.0678. Both currency pairs have recovered since, with EUR/USD peering back above 1.1070. GBP/EUR has traded within a narrow range just above 1.1800.Key Movers
German business climate data has already been released this morning and shows a fall from the previous figure and forecast. It’s a leading indicator of economic health as the survey of about 9,000 businesses indicate business conditions and expectations for the next 6 months. This was the key data release for today so the week ahead comes into focus. US consumer confidence is due tomorrow, Bank of England governor Bailey speaks on Thursday, ahead of US Final GDP data and unemployment claims on Thursday. Arguably the key data release for the week also comes from the US on Friday in the form of core PCE price index m/m. This inflation data will give clues as to whether the Federal Reserve should be contemplating interest rate cuts sooner rather than later, with no firm date set for the next cut.Expected Ranges
- GBP/USD: 1.2625 - 1.2710 ▲
- GBP/EUR: 1.1790 - 1.1840 ▲
- GBP/AUD: 1.8970 - 1.9150 ▲
- EUR/USD: 1.0670 - 1.0750 ▲