US$ firmed against all the major currencies ahead of FED chiefs testimony to congress Wednesday. Initial speculations of up to 50bps cut by the FED in July has been tempered to 25bps after stronger than expected NFP on Friday. The restarting of the China / US trade discussions has also had a positive impact on US$.
US$ firmed against C$ overnight despite firmer oil prices and anticipation BOC will hold interest rates at current levels. Ahead of FED chiefs testimony tomorrow and BOC decision, expect C$ to remain within its current range today.
Eur hit a 3 week low verses US$, this was a dollar strengthening move vs Eur weakness. Expect investors to be sidelined today.
GBP hit six month lows as retail sales data highlighted signs of the UK growing economic weakness. On going political uncertainties, Brexit and a possible BOE rate cut doesn’t bode well for GBP. July will continue to be a volatile month for GBP until the Conservative leadership is resolved.