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US Dollar Crumbles Despite Easing Trade War Fears

Pound News: Weaker Mortgage Approvals Fail to Dent UK Outlook

While the latest UK mortgage approvals figure fell short of forecast the Pound (GBP) was largely able to shrug off the weaker showing.

Although there are concerns that the UK housing market is continuing to slow markets nevertheless maintained a relatively optimistic view of the economic outlook.

Even so, GBP exchange rates look vulnerable to a fresh sell-off in the near term thanks to their recent bullish run and a data-light day.

 

Euro News: Fourth Quarter French GDP Betters Forecast

Markets were pleasantly surprised when the finalised fourth quarter French gross domestic product was revised up from 0.6% to 0.7% on the quarter.

As this indicates that economic momentum within the major Eurozone economy is stronger than previously thought the news encouraged investors to pile back into the Euro (EUR) on Monday.

However, with the latest raft of Eurozone confidence indexes forecast to show a decline on the month this EUR uptrend could prove to be short-lived.

 

US Dollar News: Sharp Manufacturing Index Dip Weighs on US Dollar

Although the threat of a US-China trade war appeared to ease somewhat over the weekend US Dollar (USD) exchange rates remained under pressure.

An unexpectedly sharp dip in the Dallas Fed manufacturing index also eroded optimism in the domestic outlook, suggesting that US economic momentum is already faltering.

Any improvement in March’s US consumer confidence index may offer USD exchange rates a rallying point this afternoon, though.

 

Canadian Dollar News: Weaker Oil Prices Limit CAD Potential

Hopes that the US approach to international trade could be softening somewhat failed to shore up Canadian Dollar (CAD) exchange rates.

As Brent crude dipped back below US$70 per barrel investors saw little reason to favour the Canadian Dollar over many of the majors yesterday.

If market concerns over rising US crude production persist CAD may fall further out of favour over the coming days.

 

Australian Dollar News: Easing Trade Tensions Fail to Benefit ‘Aussie’

Even though the prospect of a full-blown trade war between the US and China seemed to diminish this was not enough to particularly boost the Australian Dollar (AUD).

With metal prices still under a degree of pressure the potential for ‘Aussie’ gains was rather limited at the start of the week, although the antipodean currency was still able to benefit from the weakness of some of its rivals.

If risk appetite continues to pick up today, however, the Australian Dollar could see further gains.

 

Upcoming Data

Tuesday, 27 March

10:00     Eurozone Business Confidence

15:00     US Consumer Confidence Index

Joe Mayhew 

Currency Dealer

01442 892 069

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