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Pound under Pressure Ahead of BoE Decision, Canadian Dollar Surges on Oil Rally

Pound News: Sterling Cautious Ahead of BoE Rate Decision

A sharp contraction in the latest British Retail Consortium (BRC) like-for-like retail sales data offered the Pound (GBP) little in the way of support.

 

Fresh weakness could be in store for GBP exchange rates today if the Bank of England (BoE) proves more dovish than anticipated at its May policy meeting.

 

If the BoE appears to be rowing back from the prospect of a 2018 interest rate hike the appeal of the Pound is likely to deteriorate significantly.

 

 

Euro News: More Optimistic ECB Economic Bulletin Could Shore up EUR

While Italian retail sales saw a sharp uptick in March this was not enough to boost Euro (EUR) exchange rates on Wednesday.

 

Confidence in the single currency could improve, however, on the back of the European Central Bank’s (ECB) latest Economic Bulletin.

 

Any signs of greater optimism amongst policymakers should offer the Euro a solid boost against its rivals, even if the prospect of policy tightening remains distant.

 

 

US Dollar News: US Walks Away from Iran Nuclear Deal

The announcement that the US will withdraw from the Iran nuclear deal encouraged investors to pile back into the US Dollar (USD) on Wednesday.

 

With market risk appetite faltering the appeal of the safe-haven US Dollar naturally improved, even as the latest domestic data proved a little mixed in nature.

 

An increase in the US consumer price index could drive USD exchange rates to further gains this afternoon.

 

 

Canadian Dollar News: Oil Price Surge Boosts CAD

Oil prices rallied sharply as the US announced its intention to re-impose sanctions on Iran, something which is likely to cut off much of the Iranian oil supply.

 

With US stockpiles also found to have fallen further than anticipated on the week the commodity-correlated Canadian Dollar (CAD) found additional support.

 

Even so, if the latest Canadian new housing price index figures prove disappointing the Canadian Dollar may struggle to hold onto its gains for long.

 

 

Australian Dollar News: ‘Aussie’ Under Pressure as Risk Appetite Eases

As demand for risk-sensitive assets declined sharply this left the Australian Dollar (AUD) on a softer footing yesterday.

 

Even as Chinese export volumes rose sharply on the year this was not enough to prevent AUD exchange rates coming under fresh pressure.

 

With forecasts pointing towards a contraction in March’s Australian home loans data the mood towards the ‘Aussie’ is unlikely to improve particularly in the near term.

 

Upcoming Data

 

Thursday, 10 May

09:00     European Central Bank Economic Bulletin

12:00     Bank of England Rate Decision

13:30     Canada New Housing Price Index

13:30     US Consumer Price Index

 

David Worthington

Currency Trader

daw@fcgworld.co.uk

T: 01442 892 065

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