Pound Sterling

Markets Calm Following Turkish Central Bank Shock

Pound News: Sterling Losses Limited but Markets Pull Back on Bullish Longs

The Pound slipped today but avoided major losses as UK coronavirus recovery hopes persisted and supported the British currency’s outlook.

Tomorrow will see the publication of the UK’s January job market report and could influence the Pound’s movement if it surprises investors, although unemployment is expected to edge higher to 5.2%.

Euro News: Euro Recovers after Turkey’s Central Bank Shock

Over the weekend, Turkey’s President Recep Tayyip Erdogan sacked the Governor of Turkey’s central bank. Naci Agbal, who had been more hawkish on monetary policy than Erdogan had liked, was replaced with Erdogan ally Sahap Kavcioglu.

This news shocked markets, particularly assets with exposure to Turkish banks such as those in the Eurozone, which weighed on the Euro.

However, EUR exchange rates later recovered as the US Dollar weakened, which pushed the single currency higher due to the pairing’s negative correlation.

Amid a lack of notable Eurozone data until Wednesday, the Euro will continue to react to market sentiment and Eurozone coronavirus developments in the coming sessions.

US Dollar News: USD Dips despite Early Safe-Haven Demand

The US Dollar made gains on safe-haven demand at the start of the European session following the uncertainty and plunge in Turkish stock markets.

However, USD exchange rates weakened later as markets calmed and a pullback in US Treasury yields weighed on the ‘Greenback’.

US manufacturing data from Richmond Fed is due tomorrow, and Federal Reserve Chairman Jerome Powell will be holding a testimony, which could drive additional movement in USD.

Canadian Dollar News: CAD Strength Persists despite Risk-Off Movement

Despite markets heading for safe havens today, the relatively risk and trade-correlated Canadian Dollar continued to strengthen, remaining one of the market’s most appealing major currencies.

A recovery in prices of oil following last week’s dip is helping the commodity-correlated Canadian Dollar to trend steadily.

No notable Canadian data is due tomorrow, with investors likely continuing to react to shifts in risk-sentiment and oil prices for now.

Australian Dollar News: ‘Aussie’ Attempts to Avoid Losses

The Pound to Australian Dollar exchange rate remained volatile this morning. While some risk-off movement weighed on the Australian Dollar, it remains generally appealing on global coronavirus recovery hopes.

Risk-sentiment will continue to drive the Australian Dollar tomorrow. Markets are also anticipating Wednesday’s Asian session, when Australian PMI data will be published.

Upcoming Data

Tuesday 23rd March

07:00    UK Job Market Report

11:00    UK CBI Industrial Trends Orders

14:00    US New Home Sales

14:00    US Richmond Fed Manufacturing

16:00    Fed Chairman Powell Testimony