Pound (GBP) rangebound ahead of BoE rate announcement
The pound (GBP) remained largely static on Wednesday, as investors held fire ahead of today’s interest rate decision from the Bank of England (BoE).
Sterling then leapt in overnight trade amid reports that US President Donald Trump is set to unveil a new trade pact with the UK later today.
All eyes are now on the BoE. While a 25bps rate cut is already priced in, the pound could slip if policymakers hint at further cuts before the end of the year.
Euro (EUR) boosted by upbeat German data
The euro (EUR) advanced yesterday, bolstered by Germany’s latest factory orders report.
March’s data showed a notable jump in demand, surpassing forecasts and supporting hopes that the German economy is gaining momentum.
Today’s industrial production figures from Germany look to extend the upside in the euro after also reporting a stronger-than-expected rise.
US dollar (USD) rallies post-Fed policy hold
The US dollar (USD) drifted through much of Wednesday as markets awaited the outcome of the Federal Reserve’s latest policy meeting.
The ‘greenback’ surged after the Fed kept rates steady and Chair Jerome Powell signalled caution amid lingering uncertainty, prompting traders to scale back expectations for a June rate cut.
In addition to fallout from the Fed’s rate decision, the latest US jobless claims may also influence USD today, with a drop in new claims potentially driving further gains.
Canadian dollar (CAD) softens as oil rally pauses
The Canadian dollar (CAD) edged lower on Wednesday as crude oil prices struggled to maintain recent momentum.
With no key Canadian data due, CAD movement is expected to remain tied to fluctuations in oil markets throughout today’s session.
Australian dollar (AUD) lifted by trade optimism
The Australian dollar (AUD) was on a rollercoaster overnight, initially falling in response to the Fed’s hawkish stance before climbing back as renewed optimism over a US-China trade deal brightened the mood in Asia.
New Zealand dollar (NZD) mixed on shifting sentiment
The New Zealand dollar (NZD) also experienced choppy trading overnight, following a similar pattern to the Australian dollar amid an uncertain risk environment.
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