Euro firms on ECB Lagarde comments

The euro ticked higher on Monday, supported by comments from European Central Bank (ECB) President Christine Lagarde.

Meanwhile, the pound is trading in a narrow range so far this morning, with GBP/EUR flat at €1.1687 and GBP/USD stable at $1.2690. GBP/CAD is rangebound at CA$1.7130, while GBP/AUD and GBP/NZD hold steady at AU$1.9366 and NZ$2.0560, respectively.

Coming up, will a plunge in US durable goods orders drag on the US dollar this afternoon?

What’s been happening?

The euro traded with modest gains at the start of this week, following a speech from European Central Bank President Christine Lagarde.

Speaking before the European Parliament, Lagarde said the ECB’s restrictive monetary policy stance acts as a ‘safeguard against a sustained wage-price spiral’, suggesting the bank isn’t quite ready to start cutting interest rates.

The US dollar dipped on Monday, as it was pressured by expectations for Federal Reserve interest rate cuts.

The US central bank is now expected to deliver multiple rate cuts over the summer, at a slightly more accelerated pace than previously forecast.

USD investors also appeared wary ahead of some high-impact US data releases later in the week.

Meanwhile, the pound trading without a clear direction yesterday, amid a lull in UK economic data and a mixed market mood.

What’s coming up?

In the spotlight today will be the release of the latest US durable goods orders data, later this afternoon.

January’s figures are expected to report a dramatic contraction in order growth. Could this weaken the US dollar today?

In the meantime, today’s session was kicked off with the publication of Germany’s consumer confidence figures.

Today’s figures reported a modest improvement in household sentiment going into March. However, the outlook remains very pessimistic, which appears to be limiting demand for the euro this morning.

For GBP investors the focus today will be on a speech by Bank of England (BoE) Deputy Governor Dave Ramsden. If Ramsden strikes a hawkish chord the pound may rally.