Pound unfazed by softer UK inflation

Pound (GBP) gains ground in spite of weak jobs figures

The pound (GBP) was able to edge higher against its weaker peers yesterday, despite disappointing UK labour market data.

The UK unemployment rate unexpectedly increased in the three months to March, while wage growth cooled. However, GBP was cushioned by news that employment rose by a stronger-than-forecast 148,000.

So far today, Sterling has brushed off a softer UK inflation reading. Although price pressures eased by more than expected last month, economists still anticipate inflation will rise over the course of 2026.

Euro (EUR) slips amid stronger USD

The euro (EUR) came under pressure yesterday as its negative trading relationship with the strengthening US dollar (USD) dented EUR demand.

At the same time, an absence of notable Eurozone data left the single currency lacking support.

With this morning’s German producer price index failing to move the dial for EUR, the euro may remain sensitive to USD dynamics today.

US dollar (USD) strengthens as geopolitical jitters intensify

The safe-haven US dollar advanced yesterday as mounting geopolitical unease pushed markets towards risk-off trade.

US President Donald Trump warned that he may have to strike Iran again, while Tehran said it would ‘open new fronts’ in the conflict if US attacks resumed.

Should Middle East tensions continue to escalate today, the US dollar could attract further support. Tonight’s Federal Reserve meeting minutes may also lift USD if they point to a hawkish consensus among policymakers.

Canadian dollar (CAD) rises despite softer inflation

The oil-linked Canadian dollar (CAD) strengthened yesterday as crude prices climbed, although weaker-than-expected domestic inflation data capped CAD’s gains.

With Canadian economic releases thin on the ground today, the ‘loonie’ may be left to move in line with oil price dynamics.

Australian dollar (AUD) subdued in cautious trade

The Australian dollar (AUD) remained muted overnight, following yesterday’s losses, as a downbeat market mood limited demand for the risk-sensitive ‘Aussie’.

New Zealand dollar (NZD) pressured by risk-off mood

The New Zealand dollar (NZD) fluctuated overnight, with the cautious market backdrop keeping NZD under pressure.


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Samuel Birnie

Contact Samuel Birnie


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