Business Insider Brexit Report Boosts Pound Sterling Exchange Rates
The Pound recorded strong gains against many of its peers yesterday, after a report published by Business Insider suggested that the European Parliament was preparing a resolution to call for the UK to receive ‘privileged’ access to the single market after Brexit.
This followed the morning’s speech from Brexit Secretary David Davis, in which he sought to assure the EU that the UK has no intentions of tearing up regulations in order to try and undercut the bloc.
Today’s average weekly earnings figures could boost the Pound if they show that pay growth has risen, as this would weaken the decline in real wages. There are also speeches from Bank of England (BoE) officials Mark Carney, Ben Broadbent, Andy Haldane and Silvana Tenreyro.
New Delay to Greek Bailout and Approaching US Policy Minutes Pushes GBP/EUR Higher
Eurogroup finance ministers met yesterday to discuss the latest tranche of Greek bailout funding; GBP/EUR exchange rates were able to climb after officials concluded that the Greek government has not yet implemented all changes necessary to unlock €5.7 billion worth of additional funding.
Additionally, markets were waiting for tonight’s US policy meeting minutes, which was weighing on the Euro due to the inverse correlation it shares with the US Dollar.
Although there is a slew of preliminary Markit PMIs due from the Eurozone this morning, markets may overlook this given the importance of the US releases due out this evening.
US Dollar Pushed Higher as FOMC Meeting Minutes Approach; GBP/USD Inches Lower
There was little on the US economic calendar yesterday, but the approach of tonight’s meeting minutes from the Federal Open Market Committee’s (FOMC) 31 January gathering pushed the GBP/USD exchange rate lower.
Policymakers seemed confident after the first policy meeting of this year, so markets are hoping for further signs that interest rates will rise next month when the accounts of the meeting are released.
Pound Sterling and US Dollar Strength Enables GBP/CAD Advance after Poor Canadian Data
GBP/CAD had three distinct advantages yesterday that allowed it to record strong gains.
First was the news regarding potential access to the single market after Brexit that was boosting Sterling. Second, the strength of the US Dollar was weighing on demand for the commodity-correlated Canadian Dollar.
Third, December’s Canadian wholesale trade sales data showed a surprise -0.5% decline month-on-month, compared to forecast growth of 0.4%.
RBA Monetary Policy Meeting Accounts Offer Some Hope, but GBP/AUD Gains
With the US Dollar on the advance, it was hardly surprising that the GBP/AUD exchange rate was able to climb yesterday.
Markets were not in the mood for the high-risk Australian Dollar, although the early release of the Reserve Bank of Australia’s latest policy meeting minutes contain some glimmers of hope.
GBP/NZD Exchange Rate Trudges Higher after Minor Drop in Dairy Prices
The New Zealand Dollar was faring well yesterday, considering the lack of risk appetite on the markets in the face of the strengthening US Dollar.
GBP/NZD was still able to make minor gains, however, after the latest Global Dairy Trade auction saw a -0.5% drop in dairy prices. Given the last three events have recorded solid gains, this was not too much of an upset.