A -2.6% monthly GDP contraction weighed heavily on the pound as worries over the UK’s economic outlook picked up again.
As Fed policymakers opted to deliver two emergency interest rate cuts in close succession, however, this undermined the strength of USD exchange rates.
With interest rates slashed to 0% the potential for US dollar gains diminished as anxiety over the Covid 19 pandemic’s impact on the US economy building.
Even so, growing fears over the potential for a fresh global recession saw the safe-haven US dollar hold its own against a number of the majors.
As the Fed has now expended most of its monetary policy ammunition, though, confidence in the US dollar could soon start to fade.
Any dip in February’s US retail sales data could put a dampener on USD exchange rates, highlighting the risk of a wider deterioration in domestic growth momentum.
Forecasts point towards a significant drop in March’s Philadelphia Fed manufacturing index, meanwhile, leaving the door open to further US dollar selling pressure if the sector continues to show signs of slowing.
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)