Pound (GBP) see-saws following CPI
The pound (GBP) initially ticked higher during yesterday’s European session, with the currency shrugging off a cooldown in UK inflation amid signs that underlying price pressures remained stubborn.
However, Sterling relinquished its gains as trade went on, with markets continuing to price in a Bank of England (BoE) interest rate cut in March.
Looking forward, the latest industrial trends orders data from the Confederation of British Industry (CBI) could impact GBP today. Another fall in orders in February could weigh on the pound.
Euro (EUR) slips amid Russia-Ukraine peace talks
The euro (EUR) weakened yesterday, with the currency coming under pressure from a lack of notable progress in Russia-Ukraine peace talks.
EUR investors were also anxious about reports that the US has been pressuring Kyiv to cede territory to Moscow, in order to end the war by June.
Later in today’s session, the Eurozone’s preliminary consumer confidence index is expected to improve to its highest level since October 2024, which could boost the euro.
US dollar (USD) climbs as data beats expectations
The US dollar (USD) trended higher yesterday, despite some volatility, as US economic data exceeded forecasts.
Although durable goods orders contracted in December, the downturn wasn’t as deep as feared. Additionally, US industrial production accelerated more than expected in January.
The latest US jobless claims figure could influence USD exchange rates today, with investors sensitive to signs of resilience or weakness in the American labour market.
Canadian dollar (CAD) weakens in spite of rising oil prices
The crude-linked Canadian dollar (CAD) faltered yesterday, despite an uptick in oil prices, as markets reassessed their Bank of Canada (BoC) rate expectations in the wake of Tuesday’s softer CPI data.
Canada’s trade figures for December could impact the ‘loonie’ today, with an ongoing deficit potentially pressuring CAD.
Australian dollar (AUD) rebounds on positive jobs data
The Australian dollar (AUD) rallied overnight on Wednesday, reversing some of its recent losses as stronger-than-expected Australian jobs stoked hawkish Reserve Bank of Australia (RBA) rate bets.
New Zealand dollar (NZD) buoyed by cautious optimism
The New Zealand dollar (NZD) also firmed in overnight trade, thanks to a modest improvement in market risk appetite.
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