Pound (GBP) Pressured amid Ukraine Crisis and BoE Commentary
The Pound (GBP) tumbled yesterday as analysts believe Russia is on the brink of a full invasion of Ukraine. This dented the appeal of some European currencies, particularly the perceived riskier Pound.
Meanwhile, Bank of England (BoE) policymakers sought to rein in aggressive rate hike bets, with BoE Governor Andrew Bailey warning markets ‘not to get carried away’. This also put the Pound under pressure.
Another speech from Bailey later today could cause more movement in the Pound, while the Russia-Ukraine crisis may also exert some pressure.
Euro (EUR) Dips on Poor Data and Russian Invasion Fears
The Euro (EUR) fell against the majority of its rivals on Wednesday as German consumer confidence unexpectedly dropped to a ten-month low.
Rising concern of an imminent Russian invasion also weighed on the single currency, as did its negative correlation to a strengthening US Dollar (USD).
The crisis in Ukraine will likely continue to affect EUR exchange rates today, as could a number of speeches from European Central Bank (ECB) policymakers.
US Dollar (USD) See-Saws amid Shifting Risk Sentiment
The safe-haven US Dollar (USD) initially slipped yesterday as investors risk appetite returned following softer-than-expected sanctions on Russia.
However, USD exchange rates then skyrocketed in overnight trade as markets were rocked after Russia launched a full-scale invasion of Ukraine.
Looking ahead, risk sentiment could determine most movement in USD today. However, jobless claims, GDP data and Federal Reserve speeches could also influence the ‘Greenback’.
Canadian Dollar (CAD) Firms as Oil Prices Rise
The oil-sensitive Canadian Dollar (CAD) strengthened yesterday as rising tensions in Ukraine pushed crude prices higher.
Canadian data remains thin on the ground today so oil prices could continue to exert a strong influence over the ‘Loonie’.
Australian Dollar (AUD) Stumbles as Russia Invasion of Ukraine Begins
The Australian Dollar (AUD) fell back overnight on Wednesday, with the risk sensitive ‘Aussie’ struggling to attract support as market sentiment soured in the wake of Russia’s invasion of Ukraine.
New Zealand Dollar (NZD) Undermined by Downbeat Market Mood
The New Zealand Dollar (NZD) also retreated overnight, with the RBNZ shedding all of its Reserve Bank of New Zealand (RBNZ) derived gains as risk appetite fell sharply.