US Dollar Rallies on Rising US Treasury Yields

Pound News: Lockdown Easing Optimism Keeps Sterling Buoyed

Investors have been buying the Pound since markets opened this week, amid optimism over the UK’s plans to gradually ease its third coronavirus lockdown, with UK schools reopening today.

Still, the Pound’s movement has been more volatile since last week. While optimism about recovery is high, analysts note that the UK’s current economic performance is not particularly impressive. This is making it harder for Sterling to hold its best levels.

While most of this week’s UK economic calendar is quiet, Sterling will react to rivals and coronavirus news until Friday, when UK growth data will be published.

Euro News: EUR Lacks Drive to Advance against Rivals

A combination of a rebounding US Dollar, as well as some weaker-than-expected Eurozone data, have left investors will little reason to buy the Euro today.

This morning’s German industrial production data from January was much weaker than expected at –2.5%, weighing on EUR exchange rates.

More key Eurozone data is due tomorrow, including the bloc’s Q4 employment and GDP growth rate figures. If Eurozone growth was better than expected in Q4 it could boost confidence in the bloc’s resilience and support EUR strength.

US Dollar News: USD Rally Continues on Rising US Treasury Yields

Last week saw major progress in the huge US fiscal stimulus package, as well as a far better-than-expected US non-farm payroll report. Optimism around the potential for US economic recovery has caused the US Dollar to rebound against many rivals since last week.

The US Dollar is continuing to strengthen today as US Treasury yields rise and the Senate approved the $1.9 trillion US fiscal stimulus package.

USD’s rally could continue through until at least Wednesday and the release of the US consumer price index, which could then head higher again if inflation supports a further rise in bond yields.

Canadian Dollar News: Stronger Trade Outlook Keeps CAD Strong

Optimism around global commodity trade, as well as stronger-than-expected Canadian export data, left the Canadian Dollar one of last week’s most appealing currencies.

The Canadian Dollar has remained appealing since markets opened today as investors continue to become more optimistic on recovery hopes and commodity trade.

Meanwhile, investors may not want to move too much on the Canadian Dollar ahead of Wednesday’s anticipated Bank of Canada (BoC) policy decision.

Australian Dollar News: Market Optimism Remains High

The Australian Dollar remains appealing, despite a rebound in its rival the US Dollar. Last week’s US fiscal stimulus and economic news also boosted global market recovery optimism, which is supporting the Australian Dollar’s appeal as well.

Australian business and consumer confidence data will be published over the coming two days and could boost AUD if they impress. Optimistic comments from Reserve Bank of Australia (RBA) Governor Philip Lowe could buoy the ‘Aussie’ as well.

Upcoming Data

Tuesday 9th March

00:30    Australian Business Confidence

06:30    French Non-Farm Payrolls

07:00    German Trade Balance

10:00    Eurozone Employment Change

10:00    Eurozone Growth Rate

11:00    US NFIB Business Optimism