The US dollar (USD) has opened higher against all major currencies in a week that promises much volatility due to a packed economic calendar.
The euro (EUR) drifted lower last week, and despite not being the worst performing currency, it touched lows last seen in March. The euro edged lower particularly on non-committal comments from the European Central Bank (ECB) President Draghi that the market interpreted as a dovish stance. On Tuesday, Draghi will be crossing the wires again from Berlin, where he will talk about equity, stability and monetary policy. Investors will be hoping for more clarity this time.
Meanwhile, the British pound (GBP) started last week by retracing its recent plunge, but then edged lower towards the end of the week. Brexit headlines will still be the main driver for the GBP this week, particularly as Bank of England (BOE) Governor Carney is set to testify about the economic consequences of the country’s exit from the European Union. Aside from that, traders will watch out for the release of quarter on quarter Preliminary GDP on Thursday.
In other currency news, the commodity currencies all weakened against the dollar, but it was the Canadian dollar (CAD) that posted the worst performance of last week. Bank of Canada (BoC) Governor Poloz, last week, discussed an active stimulus action and changed investor sentiment on the CAD. The CAD then accelerated its losses on Friday as Canada delivered weaker than expected consumer and retail numbers. Poloz will be crossing the wires again today to kick off what looks to be a very action packed week for the Canadian dollar as well as the overall market.