Euro (EUR) climbs as GDP beats expectations
The Euro (EUR) rallied on Tuesday after the latest Eurozone GDP data revealed that the bloc avoided a recession at the end of last year.
The bloc’s economy stalled in the fourth quarter of 2023, rather than contracting 0.1% as expected. In addition, the year-on-year GDP figure showed a surprise rise of 0.1% in Q4.
This afternoon, Germany’s latest inflation figures are due out. Could a sharp cooldown in inflation this month see EUR trim its gains?
Pound (GBP) softens as shop inflation eases
The Pound (GBP) faced some selling pressure yesterday after new data showed that UK shop inflation cooled to its lowest level since May 2022.
Later in the session, the International Monetary Fund (IMF) released its latest economic outlook, in which it downgraded the UK’s 2025 growth forecast and advised against expected tax cuts in the Chancellor’s Spring Budget.
Turning to today, the Pound could be subdued as investors await tomorrow’s interest rate decision from the Bank of England (BoE).
US Dollar (USD) firms despite risk-positive trade
The US Dollar (USD) ticked higher against its weaker rivals yesterday, despite a cautiously upbeat market mood.
Additionally, a rise in US Treasury bond yields following stronger-than-expected US jobs data also helped to keep the ‘Greenback’ afloat.
Looking forward, the spotlight is on the Federal Reserve’s interest rate decision this evening. Any indication that the Fed could begin cutting rates in March may spark a selloff in USD.
Canadian Dollar (CAD) unclear amid wavering oil prices
The Canadian Dollar (CAD) was mixed yesterday as choppy oil prices left the crude-linked ‘Loonie’ unable to find a clear direction.
Turning to today, Canada’s latest GDP data could drive movement. Will anaemic growth put pressure on CAD exchange rates?
Australian Dollar (AUD) slides amid easing inflation
The Australian Dollar (AUD) tumbled overnight after Australia’s latest inflation figure missed forecasts, cooling more than expected in the fourth quarter of 2023. This in turn stoked expectations of a coming rate cut from the Reserve Bank of Australia (RBA).
New Zealand Dollar (NZD) slips despite stronger business confidence
The New Zealand Dollar (NZD) was dragged down by its positive correlation with AUD last night, although an unexpected improvement in New Zealand business confidence cushioned NZD from steeper losses.