Last week the relief rally people had been expecting finally came. As markets looked to digest the moves of the central banks and upcoming 2022 first half ending we saw the US Dollar give back a little. This was accompanied by yields falling and risk assets rising as the fall in commodity and energy prices raised hope that inflation is nearing its peak.

Currency markets remained subdued with very little movement as markets work out what to do next.

The Euro managed to be one of the best performers of the week even with a small 0.5% gain on the week. The single currency is still struggling to make a case to move higher.

GBP made slight gains despite inflation printing at 9.1% YoY. The BoE now expect inflation to top out around 11% but there seems little appetite to act with interest rates for now.

With the relief rally commodity currencies should have performed better. AUD and NZD ended the week broadly unchanged vs the US Dollar.

CAD continued to struggle as WTI lost further ground. Oil lost 2.3% during the week taking the CAD lower again.

The week ahead should see a continuation of relief rally. The weeks ata sees GDP from US, Canada and UK along with PMI and inflation data.