Pound (GBP) Jumps as UK PMIs Beat Forecasts
The Pound (GBP) surged higher yesterday as an unexpected recovery in UK private sector activity cheered GBP bulls.
The UK’s latest PMIs exceeded forecasts, with the services sector showing a surprise return to growth this month. Not only did this indicate a more resilient UK economy, but it also raised expectations for more monetary tightening from the Bank of England (BoE).
Sterling may struggle for a clear direction today amid a lack of UK data. Will GBP trim its gains?
Euro (EUR) Mixed amid Positive Data and Russia-Ukraine Worries
The Euro (EUR) faced mixed movement yesterday, slipping against its stronger peers, as positive economic data and Russia-Ukraine worries pulled the currency in two different directions.
Although the Eurozone PMIs and Germany’s ZEW economic sentiment index beat forecasts, fears of an escalation in Ukraine pressured EUR exchange rates. Russian President Vladimir Putin delivered a bellicose speech amid expectations of a fresh offensive this week.
Turning to today, economists expect Germany’s latest business climate index to show a continued recovery. Will this be enough to prompt a reliable upside in EUR?
US Dollar (USD) Rises amid Souring Sentiment
The safe-haven US Dollar (USD) enjoyed a risk-off market mood yesterday, as growing geopolitical tensions triggered bearish trade.
However, USD relinquished some of its gains in the afternoon, despite stronger-than-expected PMI results.
Looking ahead, the minutes from the Federal Open Market Committee’s (FOMC) February meeting are in focus. If Fed policymakers expressed an appetite for further rate hikes, USD could climb.
Canadian Dollar (CAD) Drops on Cooler CPI
After an initial upside, the Canadian Dollar (CAD) slumped yesterday. A steeper-than-forecast decline in Canadian inflation cemented expectations that the Bank of Canada (BoC) was at the end of its rate hiking cycle.
Today, a lack of Canadian data could see the crude-linked ‘Loonie’ driven by oil price dynamics.
Australian Dollar (AUD) Tumbles as Wage Growth Misses Forecasts
The Australian Dollar (AUD) slumped overnight after Australia’s latest wage price index showed an unexpected cooldown quarter on quarter. This dented Reserve Bank of Australia (RBA) rate hike bets, dragging the ‘Aussie’ lower.
New Zealand Dollar (NZD) Strengthens on Hawkish RBNZ Hike
The New Zealand Dollar (NZD) wavered higher last night after the Reserve Bank of New Zealand (RBNZ) delivered a hawkish rate hike. The bank raised rates by 50bps and signalled more increases to come.