Published: 5 May at 3 PM Tags: Euro, Dollar, Pound Sterling, America, UK, Eurozone, Australian Dollar, New Zealand Dollar, Canadian Dollar, Australia, New Zealand, USA, Canada, India,
The Pound (GBP) exchange rate rose today following news that UK car sales had recovered in April, despite being down by over 12% against pre-pandemic levels.
The Society of Motor Manufacturers and Traders (SMMT) commented on the data:
‘Demand is likely to be driven by a broad range of new models and powertrains, with confidence bolstered by the gradual reopening of the country.’
Confidence in the UK economy remains high, with falling Covid-19 cases and deaths currently in single figures.
As a result, Sterling has benefited from rising hopes in the UK economy, as May 17th will see the further lifting of lockdown restrictions.
The Euro (EUR) rose today after Oxford Economics has predicted that ‘the worst’ is over for the Eurozone’s economy following today’s Eurozone composite PMI report.
Nicola Nobile, lead Eurozone economist at Oxford Economics, commented:
‘While the uncertainty is still high at the moment with respect to the magnitude of the rebound, our bottom-up forecast now points to a quarterly GDP increase of around 1.5%.’
The latest Eurozone PMI composite figure for April beat forecasts and rose to 53.8.
As a result, EUR traders are becoming more confident about the bloc’s economic recovery, despite the EU’s delay in rolling out Covid-19 vaccines earlier this year.
US Dollar (USD)
The US Dollar (USD) has been bolstered by demand for safe-haven currencies today. Risk sentiment has fluctuated this week because of a slump in equity markets and concerns over India
’s Covid-19 crisis.
In US economic data, today saw the release of April’s ADP Employment Change report, which fell below forecasts at 742 thousand.
Analysts at Reuters commented on the data:
‘The ADP National Employment Report showed U.S. private payrolls increased in April as companies rushed to boost production amid a surge in demand, powered by massive government aid and rising vaccinations against COVID-19.’
As a result of growing confidence in the US economy, however, the US Dollar exchange rate has continue to rise this week.
Canadian Dollar (CAD)
The Canadian Dollar (CAD) has remained fairly muted this week despite rising oil prices.
Usually oil prices would bolster the commodity-correlated ‘Loonie’, but CAD’s gains have been limited by growing concerns over Canada
’s possible third-wave of Covid-19 cases.
Australian Dollar (AUD)
The Australian Dollar (AUD) has fluctuated much of this week due to fluctuating risk sentiment. As a result, demand for the risk-sensitive ‘Aussie’ has left the AUD relatively weak against its peers.
Today also saw Australia
’s latest building permits figure for March beat forecasts and rise by 17.4.
Daniel Rossi, Director of Construction Statistics at the ABS, commented on the data:
‘The total number of dwellings approved in March was the second highest recorded, only exceeded by the November 2017 result. The number of private sector house approvals also remained at elevated levels due to HomeBuilder, edging up 0.1 per cent to a new record high in March.’
The outlook for Australia’s economy continues to show improvement, so we could see the ‘Aussie’ begin to head higher later this week if confidence continues to grow in the nation’s economic recovery.
The New Zealand Dollar (NZD) has benefited from a drop in New Zealand’s latest unemployment figure. The surprise drop in unemployment in the first quarter of 2021 has provided a boost for the ‘Kiwi’.
As of Wednesday, 5th May 2021, the Pound Sterling currency rates mentioned within this news item were as follows:
GBP EUR exchange rate was 1.1583, GBP USD exchange rate was 1.3907, GBP AUD exchange rate was 1.7953, GBP NZD exchange rate was 1.9267, GBP CAD exchange rate was 1.7068, and GBP INR exchange rate was 102.6325.