Daily Currency Report
Overview
The conflict between Israel and Hizbollah has caused oil to hover near the $75/bbl level while Fedex chairman Ben Bernanke's testimony last week provoked a sell-off of the US dollar.
GBP
The sterling was the big winner last week, posting significant gains against the majors. Evidence of growing inflationary pressures in the consumer and housing sectors combined with strong retail sales figures completely negated the neutral commentary by the BoE.
USD
Market participants have an array of data ahead of them including consumer sentiment numbers, as well as housing data. If the analysts see a tangible slowdown in the housing sector, the dollar could find itself put under fresh selling pressure.
EUR
The euro continued to benefit from dollar weakness in spite of a lack of data. However, the currency assumed its position as the dollar alternative and rallied strongly.
JPY
This week will centre heavily upon the Tokyo and National CPI numbers for June. Should the inflationary measure meet or rise above expectations, traders will be able to count on the BOJ to erase the term "deflation" from their vocabulary.