After lacking direction through Monday’s session, the pound may experience more significant movement today on the latest UK jobs data.
Meanwhile, the pound is trading in a narrow range so far this morning, with GBP/EUR flat at €1.1972 and GBP/USD stable at $1.3730. GBP/CAD is rangebound at C$1.7150, while GBP/AUD and GBP/NZD hold steady at AU$1.8837 and NZ$1.9987, respectively.
Coming up, will some lacklustre US economic data extend the US dollar’s through to the end of the week?
The US dollar continued to trend lower through the European session on Thursday as a bullish market mood sapped demand for the safe-haven currency.
What’s been happening?
Reinforcing the downside in the ‘greenback’ yesterday was also the release of weaker-than-expected US initial jobless claims and PPI figures.
In addition to the euro’s negative correlation with the US dollar helping to bolster EUR exchange rates yesterday, the single currency was also supported by comments from European Central Bank (ECB) Vice President Luis de Guindos, in which he admitted ‘perhaps inflation won't be as transitory as forecast’.
The pound, meanwhile, struggled to attract support on Thursday amidst growing doubts over Boris Johnson’s premiership as the Prime Minister faced further calls to resign over his role in a rule breaking No10 lockdown party in 2020.
Kicking off today’s session was the publication of the UK’s latest GDP figures.
What’s coming up?
This morning’s release could help to underpin the pound today after reporting economic growth in the UK accelerated by 0.9% month-on-month in November, against forecasts for a more modest 0.4% expansion.
Also scheduled for release this morning is Germany’s full-year GDP report. While 2021’s figures are expected to report a return to growth for the Eurozone’s largest economy last year, the emergence of Omicron could result in growth being a little weaker than forecast, potentially limiting the appeal of the euro today.
Closing out the week will be the publication of the latest US retail sales figures, which are expected to report sales growth stalled in December. Alongside a drop in the University of Michigan’s consumer sentiment index this could see the US dollar end the session on a sour note.
Joining the corporate trading desk in 2007, Phil now over sees all of Currencies Direct’s corporate dealing activity. Having gained experience working with hundreds of businesses to optimise international payments processes and execute comprehensive risk management strategies, Phil currently works with a portfolio of corporate clients whilst managing Currencies Direct’s overall market exposure
Phil has FCA approval and has completed the Certificate in International Treasury Management (CertiTM)