Pound (GBP) Wavers as Investors Await ‘Partygate’ Report
The Pound (GBP) fluctuated again yesterday, moving sideways overall, as the country waited to see whether the Sue Gray report would be published.
An absence of UK data added to the lack of a clear trajectory in GBP exchange rates.
In today’s session, GBP investors will likely still be watching for when the ‘partygate’ report will be released.
Euro (EUR) Struggles ahead of Fed Decision
The Euro (EUR) slipped yesterday as the looming Federal Reserve decision piled pressure on the single currency.
The European Central Bank (ECB) is diverging from other central banks in terms of tightening monetary policy, and this weighed on EUR as markets braced for the Fed’s decision.
Strength in the US Dollar (USD) could put some pressure on EUR today, due to the currencies’ negative correlation. However, an unexpected rise in German consumer confidence might help to cushion any downside.
US Dollar (USD) Soars after Fed’s Hawkish Hold
The US Dollar traded in a narrow range yesterday, with investors reluctant to place any aggressive bets ahead of the Fed’s policy announcement.
USD then surged higher following the Fed decision. The US central bank signalled it would start hiking in March, as expected, but comments from Fed Chair Jerome Powell indicated that its hiking cycle could be more aggressive than anticipated.
US durable goods orders and GDP data could influence the ‘Greenback’ this afternoon. Economists expect the former to contract and the latter to improve; any surprises could trigger notable movement.
Canadian Dollar (CAD) Slips as BoC Holds Rates
The Canadian Dollar (CAD) firmed in the run-up to the Bank of Canada’s (BoC) interest rate decision yesterday. It then relinquished its gains as the central bank kept its overnight rate on hold.
Turning to today, Canada’s latest business barometer and average earnings data could influence CAD exchange rates.
Australian Dollar (AUD) Stumbles as Sentiment Sours
The Australian Dollar (AUD) slipped lower overnight as the bearish market mood, triggered by the Fed announcement, weighed on the risk-sensitive ‘Aussie’.
New Zealand Dollar (NZD) Slides despite Inflation Data
The New Zealand Dollar (NZD) also fell in overnight trade, despite New Zealand inflation exceeding forecasts, as anxious traders shunned the riskier ‘Kiwi’.