Daily Currency Update

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The pound tops currency markets

USD - United States Dollar

GBPUSD climbed to almost its highest level in two and a half months, holding steady 1.410 this morning. The UK’s major reopening plan after a four-month lockdown has increased demand for the pound.

The focus this week will be on April’s US Federal Reserve minutes and any commentary from Fed officials. Equity markets were firmly on the back foot last week with the Dow Jones, S&P and Nasdaq all suffering. Investors left equities and purchased US dollars. As a result, USD outperformed many of its peers, and it played a safe haven role.However, any further Fed comments away from policy tapering could see US dollar gains reversed. The US Dollar Index traded at 90.29 this morning, just above recent lows.

Key Movers

Later in the week, we can expect to see some major movements in the euro as manufacturing and services PMI data will be released Friday afternoon. This data shows the level of a diffusion index based on surveyed purchasing managers in the manufacturing and services industry.
As indoor hospitality resumes in the UK the pound remains on the front foot across a number of its G10 peers. A clear example of the pound's strength at the moment is against both the Japanese yen and US dollar.

The AUD recovered from a one-week low of 0.7697 to open at 0.7782 against the USD Monday morning following less than expected US consumer spending data released Friday night. But a pullback in commodities moved AUDUSD down to 0.775 at the time of writing. The Reserve Bank of Australia will release their monetary policy meeting minutes midday Tuesday.

The Canadian dollar, the most electric currency at the moment, continued 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.

Expected Ranges

EUR/USD: 1.212 - 1.216 ▲

GBP/USD: 1.407 - 1.411 ▲

AUD/USD: 0.773 - 0.778 ▼

USD/CAD: 1.209 - 1.213 ▼