Pound US Dollar Exchange Rate Weakens as USD Gains on Strong Data

Pound (GBP) Flat as UK Faces Possible Vaccine Rollout Disruption

The Pound was mostly rangebound on Thursday, but started to slip against EUR and USD overnight, although the Pound US Dollar exchange continues holding $1.37.

GBP exchange rates made initial gains that quickly faded yesterday amidst growing concerns over the AstraZeneca vaccine, which has seen widespread use throughout the UK.

The UK has already restricted its use to those over 30, something GBP investors fear could slow the rollout and lead to potential delays with reopening the economy.

In the continued absence of any notable GBP data, the Pound may continue struggling to find any meaningful support, particularly amidst rising trepidation ahead of next month’s Scottish parliamentary elections.

Sterling’s lack of support this morning and stronger EUR exchange rates have sent the Pound Euro exchange rate below €1.15 this morning.

Euro (EUR) Subdued amid Coronavirus Worries

The Euro was placed on the defensive yesterday, partly as a result of a stronger US Dollar but also due to fresh concerns over Europe’s vaccination programme.

This was primarily driven by Denmark’s decision to stop the use of the AstraZeneca vaccine, with fears that other countries could follow and derail the rollout.

Coming up, the publication of the Eurozone’s consumer price index could further dampen the appeal of the Euro this morning as it looks set to confirm a slowing of core inflation in the bloc last month.

US Dollar (USD) Stabilises on Impressive Retail Sales Figures

The US Dollar found firmer footing on Thursday, after the latest US retail sales figures blew past estimates, with sales growth rocketing up from -5.9% to 9.8% in March.

Coupled with a surprisingly sharp drop in new jobless claims last week, this helped the US Dollar to offset expectations that the Federal Reserve will keep interest rates on hold for longer than previously thought.

Looking ahead, the US Dollar could still mount a comeback at the end of this week’s session if US consumer sentiment jumps as expected this month.

Canadian Dollar (CAD) Firms on Positive Employment Data

The Canadian Dollar ticked higher through yesterday’s trading session as a shock surge in Canada’s latest ADP payroll figures helped to offset a modest slide in oil prices.

Australian Dollar (AUD) Dips as Chinese GDP Misses Expectations

The Australian Dollar ticked lower overnight on Thursday as the appeal of the China-proxy ‘Aussie’ was undermined by a slightly weaker-than-expected expansion of Chinese GDP in the first quarter of 2021.

New Zealand Dollar (NZD) Stumbles Following Chinese GDP Miss

The New Zealand Dollar was also dented by the disappointing Chinese GDP release, which offset a record jump in New Zealand’s manufacturing PMI in March.

Data Releases

10:00 EUR Inflation Rate (Mar)

10:00 EUR Trade Balance (Feb)

15:00 USD Consumer Sentiment (Apr)

Matthew Andrews

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