Pound (GBP) supported by strong PMI readings
The pound (GBP) advanced against most of its peers during yesterday’s session after the UK’s latest PMI releases exceeded expectations, indicating private sector activity unexpectedly strengthened in April despite disruption from the Middle East conflict.
However, these gains were limited as the surveys also pointed to a notable drop in business confidence and a sharp increase in costs within the services sector over the past month.
This morning’s publication of the UK’s latest retail sales figures may offer further support to Sterling, after data showed a stronger-than-forecast rebound in consumer spending last month.
Euro (EUR) pressured as Eurozone activity contracts
The euro (EUR) came under pressure on Thursday after the Eurozone’s latest PMIs revealed a steeper-than-expected contraction in private sector output.
The ongoing energy price crisis saw overall activity across the bloc fall to its weakest levels since November 2024, casting doubt on whether the economy could support a rate hike from the European Central Bank (ECB).
Germany’s latest IFO business climate index may add to the euro’s downside today if April’s reading shows confidence continued to deteriorate.
US dollar (USD) supported by Hormuz tensions
The US dollar (USD) strengthened against most major currencies yesterday as a cautious market tone boosted demand for the safe-haven asset.
Investor sentiment remained fragile amid concerns over the Strait of Hormuz, the future control of which continues to hinder diplomatic progress between the US and Iran.
Developments in the Middle East are likely to remain the primary driver for USD movement today, with further gains possible if tensions persist.
Canadian dollar (CAD) lifted by higher oil prices
The Canadian dollar (CAD) moved higher on Thursday as Brent crude rose back above $100 per barrel for the first time in a fortnight.
Looking ahead, Canada’s latest retail sales figures could weigh on the ‘loonie’ if they show a slowdown in spending through March.
Australian dollar (AUD) weighed down by cautious sentiment
The Australian dollar (AUD) remains under pressure during today’s Asian session as geopolitical uncertainty continues to dampen risk appetite.
New Zealand dollar (NZD) slips on risk-off mood
The New Zealand dollar (NZD) also declined in overnight trading, reflecting the prevailing risk-averse sentiment in global markets.
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