USD slips as Jerome Powell speaks
Wednesday 12 January, 2022
Daily Currency UpdateThe UK reported 15K fewer new cases on Monday than last week. This is a clear boost to investor, consumer, and business confidence in the UK. The UK government is meanwhile reportedly considering plans to cut the COVID-19 self-isolation period from seven days to five, a development that could ease the hit to the economy caused by the surging numbers of workers self-isolating following positive COVID-19 tests. There has been an uptick in the number of politicians and members of the public calling for Boris Johnson to resign. It is unclear whether such a resignation would be good or bad for the pound in the long term, however uncertainty is often detrimental to a currency and therefore the pound could slip on the news.
Key MoversThe US dollar slipped against its G10 peers on Monday as words from US Federal Reserve Chair, Jerome Powell, caused sentiment to slide. During his speech for his renomination, he mentioned that the US Federal Reserve were waiting and looking for interest rates to be more neutral for the economy. Alongside this, inflation is expected to remain elevated until at least mid-2022. This stance caused GBP/USD to rally into the mid-1.36s and EUR/USD to trade above 1.1370.
- GBP/USD: 1.3585 - 1.3710 ▲
- GBP/EUR: 1.1930 - 1.2080 ▲
- GBP/AUD: 1.8820 - 1.9010 ▲
- EUR/USD: 1.1300 - 1.1415 ▲