US pandemic response speech later today
Tuesday 23 March, 2021
Daily Currency UpdateIn this morning’s data releases, the UK jobless rate unexpectedly fell to 5.0% in the three months prior to January, when the country entered a new lockdown, below its forecast of a rise to 5.2%. Average wage growth rose to 4.8%, its highest since March 2008, though this reflects how job losses have been greatest in low-paid sectors such as retail and hospitality, rather than higher pay for people who are still in work. The pound slipped below 1.3775 against the US dollar this morning which could have been due to dollar strength as investors bought the US dollar.
Key MoversGermany is entering what German chancellor, Angela Merkel, has called 'a new pandemic'. She announced a strict shutdown over Easter in a bid to help contain the spread of the virus. This could weaken the euro.
As for the US dollar, all eyes will be on Washington later as U.S. Federal Reserve boss, Jerome Powell, and Treasury Secretary, Janet Yellen, speak on the pandemic response. Janet Yellen is expected not only to highlight the improved economic outlook and dramatic expansion in help to households in the US, but also highlight the need for more spending, partly paid for with higher taxes. The Biden administration is reportedly considering as much as $3 trillion worth of new measures.
In the absence of any major market-moving economic releases, any further hawkish shifts from Fed Chair Jerome Powell and Treasury Secretary Janet Yellen's joint testimony could lead to a stronger dollar.
- GBP/USD: 1.3740 - 1.3780 ▼
- GBP/EUR: 1.1555 - 1.1580 ▼
- EUR/USD: 1.1870 - 1.1895 ▼
- GBP/AUD: 1.7920 - 1.7965 ▼