United States Dollar:

The pound fell again on Thursday after UK retail sales printed weaker than expectations, rising by only 0.1% in June from May vs. 0.2% exp. With the less than hawkish MPC minutes still fresh in investors’ minds, GBP/USD went on to fall below 1.70, to a low of 1.6970. It’s failed to recover with the dollar showing signs of strength. US jobless claims, a weekly data release, showed yesterday that unemployment benefit unexpectedly dropped last week to the lowest level in eight years – it’s another sign that the U.S. labour market is starting to gather momentum and will fuel expectations for the Fed to soon start signalling when they intend to raise interest rates. GBP/USD has struggled under 1.70 and the pair opens in London at 1.6980. The main event this morning will be UK GDP data, due for release at 9:30. Q/q growth of 0.8% and 3.1% y/y is expected and if it does turn out like this it will show the UK economy has recovered all of its losses from the financial crisis and that the economy is growing at its fastest rate since 2007. US Durable Goods Orders are due for release this afternoon. `

We expect a range today in the GBP/USD rate of 1.6900 to 1.7040


Euro:

EUR/USD received a boost from stronger than expected European PMIs yesterday but come the afternoon and in response to the stronger US jobs data it drifted lower eventually falling to a low of 1.3458. It hasn’t done too much overnight and has struggled to get off of these lows – it opens this morning at 1.3465. Meanwhile, the single currency has made steady gains vs. the pound, the latter having responded negatively to the soft retail sales data yesterday.

We expect a range today in the GBP/EUR rate of 1.2575 to 1.2650


Aussie and Kiwi Dollars:

Along with most other currencies, both AUD and NZD have lost ground vs. the USD. After opening in London at .9448 yesterday, AUD/USD has dropped to open this morning’s session at .9405. NZD/USD has fallen less aggressively, perhaps a result of the bigger sell-off earlier in the week following the RBNZ’s comments. ANZ business confidence figures were also a bit weaker than expected. It’s likely to be a slumbering day today in AUD/USD and NZD/USD. There’s some Chinese data on the way over the weekend that might have an impact come Monday morning.

We expect a range today in the GBP/AUD rate of 1.7950 to 1.8120

We expect a range today in the GBP/NZD rate of 1.9780 to 1.9920


Data Releases for the next 24 hours:

AUD: No data

EUR: German Ifo Business Climate, M3 Money Supply y/y, Private Loans y/y

GBP: Prelim GDP q/q

NZD: No data

USD: Core Durable Goods Orders m/m

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