Pound News: Forecast-Beating UK Growth Offers Sterling Support
The Pound received support this morning following the UK fourth quarter 2020 GDP figures coming in better than projected at 1.3%, instead of 1% forecast, confirming the UK avoided a double-dip recession at the end of the year.
However, the figures also indicated a revised contraction of growth in the second quarter of 19.5%, an increase of 0.5% on the previous reading.
Markit’s final March manufacturing PMI for the UK will be published tomorrow, with anything above the strong growth forecasts providing additional support to GBP exchange rates.
Euro News: Euro Remains Unappealing amid Coronavirus Fears
The Euro has remained less appealing than its major rivals, the Pound and US Dollar, because the Eurozone economy has been hit more by concerns over a ‘coronavirus third wave’.
Yesterday’s publication of Germany’s consumer price index failed to offset coronavirus concerns despite German inflation surging and meeting expectations in March.
Following today’s Eurozone inflation data roughly meeting expectations, German retail sales results could be more influential for the Euro’s movement tomorrow.
US Dollar News: USD Buoyed by Economic Optimism
Optimism that the US economy is recovering from the coronavirus pandemic, as well as hopes around an upcoming fiscal policy speech from US President Joe Biden, are keeping the US Dollar broadly appealing this week.
Rising coronavirus cases in many parts of the world are also boosting demand for safe havens, further supporting USD appeal.
However, the US Dollar has pulled back slightly today in some end of month profit taking, although this dip could prove temporary given the improved economic outlook in the US.
ISM’s US manufacturing PMI, due tomorrow is likely to be one of the week’s most important US data releases ahead of Friday’s even more influential US Non-Farm Payroll report.
Canadian Dollar News: CAD Avoiding Losses despite Lack of Fresh Support
The Pound to Canadian Dollar exchange rate is being kept under pressure this week. This is despite lower oil prices and higher US bond yields dampening demand for the oil and trade-correlated Canadian Dollar.
After Canada’s GDP growth report comes in today, CAD investors will look ahead to tomorrow’s Canadian manufacturing PMI. Meanwhile, shifting market sentiment and oil prices will remain influential key drivers of CAD movement.
Australian Dollar News: ‘Aussie’ Struggles on Risk-Aversion
Despite some forecast-beating Australian building permits data today, the Australian Dollar is struggling to hold its ground against the Pound. Investors continue to look away from currencies correlated to risk as global coronavirus ‘third wave’ fears rise.
Australian manufacturing PMIs due during tomorrow’s Asian session could influence the Australian Dollar, but tomorrow’s Australian trade and retail data publications could be even more influential to the ‘Aussie’ outlook if they surprise investors.
Thursday 1st April
01:30 Australian Trade Balance
01:30 Australian Retail Sales
07:00 German Retail Sales
09:00 Eurozone Manufacturing PMI
09:30 UK Manufacturing PMI
13:30 Canadian Building Permits
14:30 Canadian Manufacturing PMI
15:00 US Manufacturing PMI