Pound (GBP) Rebounds from Two-Week Low
The Pound (GBP) bounced back from a two-week low during yesterday’s session as an improving market mood reflected well on the UK currency.
However Sterling gains were tempered by the UK’s consumer price index as it revealed that falling demand for clothes and fuel amid the coronavirus lockdown prompted domestic inflation to slow to a three-month low in March.
Coming up this morning, the UK’s latest PMI figures will be front and centre. Will April’s preliminary figures prove as gloomy as economists fear?
Euro (EUR) Muted ahead of EU Summit
The Euro (EUR) was subdued on Wednesday as Eurozone consumer confidence deteriorated faster-than-expected in April, as the coronavirus crisis weighs on household sentiment.
Also limiting demand for the single currency was uncertainty ahead of today’s EU summit, with EUR investors skeptical whether leaders will be able to agree on a coordinated fiscal response to the coronavirus crisis.
In the meantime, EUR investors will be keeping an eye on this morning’s flash PMI figures, with demand for the Euro likely to remain muted as growth in the Eurozone’s private sector looks set to plummet to a new all-time low.
US Dollar (USD) Dips on Improving Market Sentiment
The US Dollar (USD) struggled to find support through yesterday’s session as demand for the safe-haven currency was dented in light of improving market sentiment.
This was driven by both stabilizing oil prices and hopes the passing of another US stimulus package will prove supportive of global growth.
Looking ahead, the latest US initial jobless claims report is expected to reveal another sharp increase in unemployment last week. This report, in conjunction with some potentially dire PMI figures, could weigh on the US Dollar this afternoon.
Canadian Dollar (CAD) Buoyed by Oil Price Recovery
The Canadian Dollar (CAD) ticked higher on Wednesday, with the commodity-linked ‘Loonie’ supported by a recovery in oil prices. However, the rebound in CAD was tempered somewhat by data showing a dramatic drop in domestic inflation last month.
Australian Dollar (AUD) Buoyed by Risk-On Mood
The Australian Dollar (AUD) shot higher in overnight trade on Wednesday as a more positive market mood reflected well on the risk-sensitive ‘Aussie’.
New Zealand Dollar (NZD) Strengthens on Market Optimism
The New Zealand Dollar (NZD) also trended higher in overnight trade as the risk-on mood and pull back in the US Dollar (USD) helped bolster the appeal of the ‘Kiwi’.