US dollar near 14 month highs vs. euro
Daily Currency Update
GBP - British Pound
It was a relatively quiet day for the pound yesterday. It held firm against the euro while falling vs. the US dollar. The reason the pound was able to climb vs the euro comes from the fact that the global surge in energy prices is having a particularly large impact on the euro. The gas prices across Europe appear to be increasing at a faster rate than in the UK.
Key MoversWe saw the US dollar remain at strong levels yesterday. It sat at near 14 month highs vs the euro. The fall in stock markets along with increasing energy prices have created market conditions that favour the dollar. Investors tend to buy US dollars during uncertain times because it is considered a safe asset, and this demand drives up its value.
We could see the dollar push on even further in the next two days ahead of Friday’s US jobs report. Non-farm payrolls have historically been a market mover. A print well above expectation tomorrow could put further pressure on the US Federal Reserve to start tapering its asset purchasing program sooner than anticipated. However, an underwhelming reading could give the Fed a reason to remain cautious.
- GBP/USD: 1.3555 - 1.3620 ▼
- GBP/EUR: 1.1730 - 1.1790 ▲
- GBP/AUD: 1.8650 - 1.8740 ▲
- EUR/USD: 1.1540 - 1.1620 ▼