Pound (GBP) pressured by UK growth concerns
The pound (GBP) faced headwinds at the beginning of the week, with a lack of meaningful data leaving Sterling without clear support.
With little domestic data to guide movement, GBP investors instead turned their attention to the UK’s economic vulnerability and fears over how a fresh inflationary shock could weigh on growth.
Sterling may remain on the back foot today after final figures confirmed the UK economy expanded by just 0.1% in the fourth quarter of 2025.
Euro (EUR) directionless despite ECB hike expectations
The euro (EUR) traded without a clear trend on Monday, softening against stronger counterparts even as a rise in German inflation fuelled expectations of a European Central Bank (ECB) interest rate increase in April.
EUR’s inverse relationship with the US dollar (USD) acted as a drag, while a fall in Eurozone economic sentiment during March also limited upside potential.
Attention now turns to the Eurozone’s preliminary consumer price index for March. If inflation shows a notable acceleration, it could reinforce expectations of an April rate hike from the ECB and lend support to the single currency.
US dollar (USD) supported by geopolitical tensions
The US dollar edged higher yesterday, underpinned by persistent geopolitical uncertainty which sustained demand for safe-haven assets.
Although there is some tentative optimism surrounding potential peace talks, concerns over possible US strikes on Iranian energy infrastructure pushed oil prices higher, fuelling worries about the broader economic fallout.
Later today, the latest US Job Openings and Labor Turnover Survey (JOLTS) will be released. Any drop in job vacancies for February may place some downward pressure on USD.
Canadian dollar (CAD) lifted by oil strength
The oil-sensitive Canadian dollar (CAD) gained ground yesterday as crude prices revisited recent highs. The currency held onto its gains even as energy prices eased slightly later in the session.
Canada’s latest GDP release will be in focus today. Signs that economic growth remained sluggish at the start of 2026 could see the ‘loonie’ come under pressure.
Australian dollar (AUD) unsettled following RBA minutes
The Australian dollar (AUD) fluctuated overnight after the Reserve Bank of Australia’s (RBA) latest meeting minutes indicated that some policymakers are still wary about the need for further rate increases.
New Zealand dollar (NZD) pressured by slump in confidence
The New Zealand dollar (NZD) weakened overnight after the country’s business confidence index dropped sharply, falling from 59.2 in February to 32.5 in March – its lowest level since July 2024.
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