The Yen languished near an 8-1/2-month low.
Trading was thinned in Asia on Monday due to a holiday in Japan, leaving currencies mostly rangebound, though most were pinned near recent lows against a strong Dollar. The Euro fell to a three-month trough and last traded at $1.1536. Sterling fell 0.19% to $1.3145 ahead of the Bank of England’s policy decision this week, where the central bank is expected to stand pat on rates.
The pound was also weighed down by mounting political pressures surrounding British Finance Minister Rachel Reeves, and with investors concerned about what her November budget might mean for businesses, households and overall economic activity.
While the ongoing US government shutdown is expected to delay the release of the nonfarm payrolls report on Friday, investors will have their eyes on other news, including ADP employment data and ISM PMIs this week for a pulse check on the economy.
“The lack of information is playing to sort of that calmness in markets,” said Rodrigo Catril, Senior FX Strategist at National Australia Bank.
“And for now, I suppose what could break that while the shutdown is still ongoing, (is) a big downward surprise or even upward surprise in terms of surveys or private data release. But otherwise, at the moment, even those private data releases are not screaming or telling us that the Fed should be moving in a hurry,” he said
Last week, the Fed lowered rates by 25 basis points as expected but Chairperson, Jerome Powell signalled that may be the central bank’s last reduction for the year, citing the risk of making additional moves without a more robust picture of the economy.
–Reuters–
