Pound (GBP) firms despite UK GDP contraction
The pound (GBP) found success on Thursday, despite the UK’s final GDP figures for the fourth quarter of 2023 confirming a recession last year.
The upside in Sterling seemed to come amid a risk-on mood and among weakness in some of its major rivals, along with end-of-month repositioning among currency traders.
Turning to today’s session, the only UK data of note is the final manufacturing PMI for March. Could confirmation that the ongoing contraction in UK factory activity slowed considerably last month be enough to support Sterling?
Euro (EUR) struggles as German retail sales slump
The euro (EUR) fell on Thursday after German retail sales unexpectedly slumped by 1.9%.
February’s figures meant the Eurozone’s largest economy contracted for the fourth consecutive month, raising fresh concerns over its outlook and dampening EUR demand.
Looking forward, Germany’s latest consumer price index is due this afternoon, ahead of the Eurozone CPI tomorrow. Any signs of cooling inflation could dent EUR exchange rates by reinforcing bets on an April interest rate cut from the European Central Bank (ECB).
US dollar (USD) jumps as manufacturing PMI beats forecasts
The US dollar (USD) fluctuated at the end of last week, as a risk-on mood and stronger US economic data pulled the safe-haven currency in different directions.
At the start of this week, the ‘greenback’ then surged after the ISM manufacturing PMI beat forecasts to show a return to growth for the first time in 16 months, cheering USD investors.
Coming up, economists expect to see another decline in US job openings in February. Signs of a slowing labour market could apply pressure to the US dollar.
Canadian dollar (CAD) climbs on GDP data and rising oil
The Canadian dollar (CAD) rallied on Thursday, following surprisingly strong Canadian GDP data. Rising oil prices then helped the crude-linked currency extend its gains through to the start of this week’s session.
Canadian economic data is thin on the ground today, which may leave the ‘loonie’ to trade on oil price dynamics. If crude prices continue to rise, CAD could follow suit.
Australian dollar (AUD) wavers amid RBA meeting minutes
The Australian dollar (AUD) fluctuated overnight but managed to resist losses despite the Reserve Bank of Australia’s (RBA) meeting minutes revealing that the bank did not consider a rate hike at last month’s meeting.
New Zealand dollar (NZD) wobbles amid quiet trading conditions
The New Zealand dollar (NZD) wavered last night as a lack of domestic data and a cautious market mood left the ‘Kiwi’ subdued.