Daily Currency Update

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Sterling tops currency markets for the month

GBP - British Pound

As indoor hospitality resumes in the UK the pound remains on the front foot across a number of its G10 peers. For the time being at least, Sterling bulls have forgotten the risk of an SNP majority in Holyrood and the calls for a Scottish Referendum, and this has seen the currency continue to rally in the last week or so. A clear example of the pound's strength at the moment is against both the Japanese yen and US dollar.

While global equities wobbled throughout last week, and risk was firmly off the cards, the pound managed to jump 1.5% and 0.75% respectively against these two stalwart safe haven currencies. The UK market gets a thorough diagnosis this week in the form of labour data on Tuesday, inflation on Wednesday and retail sales figures on Friday, however the market could shrug off a number of these releases once again due to the effect that the furlough scheme and other support is having.

Key Movers

Elsewhere it is probably the Canadian dollar that is the most electric at the moment as it continues to put pressure on its US dollar counterpart. The Canadian dollar has the 2017 low of 1.2070 firmly in its sights having got agonisingly close last week. From the US this week the focus will be on April's Federal Reserve minutes as well as the raft of Fed speak. As suggested earlier, equity markets were firmly on the back foot last week with the Dow Jones, S&P and Nasdaq all suffering. This has seen the US dollar outperforming many of its peers as it played a safe haven role but with Raphael Bostic and Richard Clarida both speaking on behalf of the Federal Reserve further comments or refrains away from policy tapering could see US dollar gains reversed.

Expected Ranges

GBP/USD: 1.4040 - 1.4120 ▲

GBP/EUR: 1.1600 - 1.1680 ▲

GBP/AUD: 1.8120 - 1.8280 ▲

EUR/USD: 1.2070 - 1.2150 ▲