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Hawkish BoE Comments Support Pound, Canadian Dollar Slides Ahead of Unemployment Data

Pound News: Hopes of August BoE Interest Rate Hike Continue to Mount

Brexit-based jitters provoked fresh volatility for Pound (GBP) exchange rates on Thursday as markets speculated over the possibility of Brexit secretary David Davis resigning.

Demand for the Pound found an additional boost during the afternoon as Bank of England (BoE) deputy governor David Ramsden sounded a more hawkish note on monetary policy.

If this morning’s BoE/TNS inflation attitudes survey suggests that price pressures are likely to fall further over the coming year, however, the mood of GBP exchange rates could soon sour.

 

Euro News: Single Currency Shrugs Off Shock German Factory Order Slump

Investors were not impressed to find that German factory orders had slumped -2.5% on the month in April.

While this suggests that the Eurozone economy is unlikely to see a significant rebound in the second quarter, though, Euro (EUR) exchange rates were able to hold onto a stronger footing.

With markets hopeful that the European Central Bank (ECB) is shifting to a tightening bias the downside potential of the Euro looks limited.

 

US Dollar News: US Jobless Claims Data Fails to Impress

The latest US jobless claims figures were not particularly encouraging, with a minor uptick in initial claims overshadowed by a higher number of continuing claims.

With markets in a less risk averse mood in the absence of any fresh global trade drama the appeal of the US Dollar (USD) was rather muted yesterday.

Unless market sentiment deteriorates today USD exchange rates could struggle to find any particular support.

 

Canadian Dollar News: Labour Market Tightening Could Boost CAD Rates Today

Although oil prices picked up in response to the continuing issues in Venezuela this failed to boost Canadian Dollar (CAD) exchange rates.

Demand for the Canadian Dollar remained weak as investors braced for this afternoon’s raft of Canadian unemployment data.

Signs of fresh tightening within the labour market could give CAD exchange rates a solid boost, increasing the likelihood of the Bank of Canada (BOC) raising interest rates in the summer.

 

Australian Dollar News: Narrowed Trade Surplus Weighs on ‘Aussie’ Outlook

A sharper-than-expected narrowing of the Australian trade surplus put the Australian Dollar (AUD) under fresh pressure yesterday.

With confidence in the underlying health of the Australian economy dented AUD exchange rates trended lower once again.

In the absence of any fresh domestic data the Australian Dollar looks set to remain biased to the downside in the near term.

 

Upcoming Data

Friday, 8 June

09:30     Bank of England (BoE)/TNS Inflation Attitudes Survey

13:30     Canada Unemployment Rate

 

Sam Bowrey

Currency Dealer

sbb@fcgworld.co.uk

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