Pound (GBP) pressured by BoE rate cut bets
The pound (GBP) was muted through yesterday’s session amid dovish Bank of England (BoE) interest rate speculation.
Sterling was muted as GBP investors continued to price in an expected 25bps interest rate cut in May.
In the absence of any notable UK data, movement in the pound is likely to be determined by wider market trends today.
Euro (EUR) buoyed by cautious market mood
The euro (EUR) firmed on Tuesday, with the single currency being underpinned by a risk-averse market mood.
However, these gains were ultimately capped after data showed Eurozone consumer confidence in April fell to its worst levels since November 2023 and economic sentiment fell to a four-month low.
The Eurozone will publish its latest GDP figures later today. Economists forecast the bloc will have continued to grow in the first quarter, which may help to extend the single currency’s gains.
US dollar (USD) strengthened by gloomy trade conditions
The US dollar (USD) trended broadly higher through yesterday’s session as the currency was supported by safe-haven flows.
These gains were then tested later in the session after domestic data reported a larger-than-expected decline in US job openings and consumer confidence.
All eyes will be on the latest US GDP figures today. If the preliminary figures report that the US economy saw a sharp loss of momentum in the first quarter, the US dollar is likely to slump.
Canadian dollar (CAD) underpinned by election result
The Canadian dollar (CAD) ticked higher on Tuesday as CAD investors welcomed the victory of the incumbent Liberal party in Canada’s federal election.
These gains may be tested later today, as Canada’s latest monthly GDP figures are expected to report growth slumped in March amid the uncertainty posed by Trump’s tariffs.
Australian dollar (AUD) buoyed by inflation
The Australian dollar (AUD) firmed overnight on Tuesday, as a stronger-than-expected rise in domestic inflation in the first quarter trimmed expectations for further interest rate cuts from the Reserve Bank of Australia (RBA).
New Zealand dollar (NZD) pressured by decline in business confidence
The New Zealand dollar (NZD) retreated in overnight trade, as domestic business confidence slumped to a nine-month low in April.
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