Sterling suffers on central bank decisions
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Daily Currency Update
Retail sales volumes were estimated to be flat in February, data early on Friday showed. The growth in sales volumes for clothing and department stores was offset by falls in food stores and fuel retailers. Although the news beat the forecast -0.4%, it was still a fall from the January 3.6%. German business morale improved in March, beating expectations to come in at 87.8. Although deemed a light at the end of the horizon, it is believed it will not be enough to prevent Europe’s biggest economy from slipping into another recession. Fed chair Powell delivered opening remarks at a Fed listens event on Friday, but after comments earlier in the week after the latest interest rate decision, not much came from the release.GBP/USD slipped to a session low of 1.2575 on Friday but has since been on a slow and gradual recovery. The currency pair opens at 1.2610 today. GBP/EUR touched 1.1625 at the lows but has since recovered to sit back above 1.1650. EUR/USD had twice tried to break below 1.0800 but resistance sees the currency pair trade a little higher now. The currency pair sits just under 1.0820.
Key Movers
As the Easter bank holiday approaches, there isn't much data to report this week. The US new home sales data release is the only significant event scheduled for today. Tomorrow, there may be some interest in hearing what monetary policy committee member Mann has to say at the Annual Royal Economic Society Conference in Belfast. In the upcoming week, the US CB consumer confidence data will be released on Tuesday, followed by Australian CPI data overnight into Wednesday.On Thursday, FOMC member Waller will speak at the Economic Club of New York about monetary policy, and the Canadian and US GDP data will also be released. On the same day, US unemployment claims will also be announced. FX volatility is still linked to when central banks decide to change policy. The GBP, EUR, and USD exchange rates are fluctuating as traders bet on which central bank will cut rates first. However, data supporting these speculations still has a significant influence. This week's movement, on the other hand, will likely depend on recent bank announcements.
Expected Ranges
- GBP/USD: 1.2540 - 1.2680 ▲
- GBP/EUR: 1.1620 - 1.1690 ▲
- GBP/AUD: 1.9240 - 1.9410 ▲
- EUR/USD: 1.0770 - 1.0860 ▲