Last Friday, the British Pound gained strength as UK retail sales rebounded by 0.5% in July. But later in the afternoon, Sterling gave up a lot of its gains. Going ahead, there won’t be much data for much of the week, so until the UK releases its most recent PMIs on Thursday, GBP exchange rates may not follow a clear trend.
Because markets believe the European Central Bank will progressively lower interest rates, the euro continues to hold a solid position relative to its peers. Indeed, at her most recent news conference, ECB President Christine Lagarde emphasised that policymakers are not committing in advance to a specific rate path. It was decided to stick to a meeting-by-meeting and data-dependent strategy.
Last Friday, the U.S. Dollar slightly declined, giving up some of the significant gains made during the previous session when the release of strong retail sales data allayed fears of an impending recession in the country. Looking forward, if Federal Chair Jerome Powell discusses the US’s own monetary policy during his keynote address at the Jackson Hole Symposium, markets may become extremely volatile.
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