US recession woes gain momentum
Thursday 6 April, 2023
Daily Currency UpdateYesterday's data chart was mainly flooded with PMI’s, but recession woes gain momentum as consecutive weakness in the US employment numbers raised fears of a slowdown in the US. A disappointing 19-month low of the US JOLTS Job Openings for February along with the ADP Employment Change for March which dropped to 145K from 200K expected suggests a slowing in the labor market and as a result is added pressure to the USD.
On a more supportive note for the US dollar, US-China tensions over Taiwan have improved the safe-haven appeal of the US Dollar which pushed the dollar higher yesterday. This came about after China’s retaliation over arms support to Taiwan by the US which might result in some restrictions on exports from China to the US.
Key MoversSterling could benefit in the medium term from a weaker dollar and reduced U.K. external vulnerabilities, Deutsche Bank says. Low private-sector leverage should see GBP among the outperformers in a potential USD downturn.
- GBP/USD: 1.2445 - 1.2515 ▲
- GBP/EUR: 1.1405 - 1.1475 ▲
- EUR/USD: 1.0885 - 1.0955 ▲