Pound (GBP) climbs on upbeat retail figures
The pound (GBP) saw broad support at the end of last week, buoyed by encouraging domestic data.
UK retail sales rose by 1% month-on-month in February. While this marked a slowdown from January’s 1.4% increase, it significantly outperformed forecasts for a 0.3% decline.
Looking ahead, with UK economic data in short supply this week, the pound’s direction is likely to be dictated by broader market sentiment.
Euro (EUR) gains on tariff negotiation hopes
The euro (EUR) strengthened on Friday following reports that the European Commission may be willing to make concessions to the US in exchange for a partial easing of tariffs.
This development tempered fears of a damaging EU-US trade dispute, bolstering EUR sentiment.
Today, attention turns to Germany’s latest consumer price index. If March’s preliminary CPI figures indicate cooling inflation, European Central Bank (ECB) rate cut speculation could drag the euro lower.
US dollar (USD) lifted by inflation surprise
The US dollar (USD) edged higher at the end of last week as the Federal Reserve’s preferred inflation gauge, the core PCE price index, unexpectedly accelerated.
This development dampened expectations for imminent Fed rate cuts, though lingering uncertainty over US trade policy and recession risks kept the ‘greenback’s’ gains in check.
This week, attention will remain on President Donald Trump’s reciprocal tariffs, with concerns over their potential economic fallout likely to shape USD movement.
Canadian dollar (CAD) subdued as GDP stagnates
The Canadian dollar (CAD) struggled for support on Friday after data revealed that Canada’s economy stagnated in February.
With a lack of domestic data on the calendar today, the ‘loonie’ is likely to take direction from oil price movements.
Australian dollar (AUD) pressured by tariff uncertainty
The Australian dollar (AUD) edged lower during Monday’s Asian session as caution prevailed ahead of the implementation of Trump’s reciprocal tariffs.
New Zealand dollar (NZD) slips amid risk aversion
The New Zealand dollar (NZD) also weakened overnight, as the prospect of US tariffs dampened market risk appetite.
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