Pound (GBP) Surges Following BoE Rate Decision
The Pound (GBP) shot higher on Thursday in response to the Bank of England’s (BoE) first rate decision of 2020.
Ahead of yesterday’s decision there had been considerable speculation that the bank may opt for an early rate cut in response to some weak UK economic data in recent weeks.
However the bank ultimately decided to keep rates on hold this month, with a smaller-than-expected split of the Monetary Policy Committee resulting in a sharp uptick in Sterling.
It remains to be seen if the Pound will be able to hold on to these gains through to the weekend however as the UK’s official exit from the EU later this evening is sure to stoke some jitters amongst GBP investors.
Euro (EUR) Firms as German Inflation Rises
The Euro (EUR) found some modest support yesterday as markets welcomed Germany’s consumer price index (CPI).
The CPI figures reveal domestic inflation accelerated to a six-month high in January which (coupled with another robust employment reading) helped boost optimism regarding the Eurozone’s largest economy.
Looking ahead, could the Euro maintain its upward momentum this morning if the Eurozone’s latest GDP estimate comes in above expectations?
US Dollar (USD) Muted as US GDP Fails to Impress
After an initial bounce amid an uptick in safe-haven demand, the US Dollar (USD) was mostly subdued through yesterday’s session in response to the latest US GDP figures.
US GDP only expanded by 2.3% through 2019, down from 2.9% in 2018, with economists expressing concerns about a slowdown in consumer spending.
On the docket for USD investors today is the latest PCE price index, with a rise in the Federal Reserve’s favoured measure of inflation potentially buoying the appeal of the US Dollar this afternoon.
Canadian Dollar (CAD) Undermined by Sliding Oil Prices
The Canadian Dollar (CAD) was put on the defensive on Thursday as a sharp slump in oil prices limited demand for the commodity-linked currency.
This downtrend in the ‘Loonie’ may persist through today’s session if this afternoon’s GDP figures confirm Canada’s economy stagnated in November.
Australian Dollar (AUD) Slips to New Multi-Month Lows as Coronavirus Panic Grows
The Australian Dollar (AUD) continued to retreat on Thursday as a spike in coronavirus cases in China and concerns over its potential impact on the global economy weighed heavily on market risk appetite.
New Zealand Dollar (NZD) Knocked by Risk-Off Trade
Movement in the New Zealand Dollar (NZD) largely mirrored that of the Australian Dollar (AUD) yesterday, with the risk-sensitive ‘Kiwi’ also tumbling in response to renewed concerns over the coronavirus outbreak in China.