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Mon 13 Jul 2020 06:46GMT

Pound Holds Gains, Euro Falls, US Dollar Weaker before FOMC

Published: 8 Apr at 9 AM Tags: Euro, Dollar, Pound Sterling, America, UK, Eurozone, Australian Dollar, New Zealand Dollar, Canadian Dollar, Australia, New Zealand, USA, Canada, Germany, Greece,

Pound Sterling
Although the British Retail Consortium’s Shop Price Index showed a steeper annual decline in March than in February, the Pound continued to derive support from Tuesday’s impressive UK Services PMI. The British asset was trending higher against both the Euro and US Dollar prior to the publication of UK car registration data.

Although the Eurozone published encouraging ecostats on Tuesday, Greek bailout concerns prevented the European asset from advancing. As the week progressed, the common currency posted additional declines as a result of below-forecast German Factory Orders data.

US Dollar
A recent run of below-forecast US data (including last Friday’s concerning US Non-Farm Payrolls report) has led investors to bet that the Federal Reserve will delay hiking interest rates until towards the end of the year. Consequently, demand for the ‘Greenback’ has waned and the US Dollar has softened against a number of its peers.

Australian Dollar
While the ANZ Roy Morgan Weekly Consumer Confidence index showed a softening in sentiment, the Australian Dollar was still riding high off the back of the RBA’s recent interest rate decision. During the local session, the AiG Performance of Construction Index could cause further fluctuations in the South Pacific currency.

New Zealand Dollar
Over the course of Australasian trading the New Zealand Dollar tracked its Australian relation higher and advanced on a broadly softening US Dollar. The ‘Kiwi’ was also trending in a stronger position due to improved bets that the Reserve Bank of New Zealand will refrain from cutting interest rates in the near future.

Canadian Dollar
Softer oil prices didn’t prevent the Canadian Dollar from advancing on the Pound on Tuesday. The reduced odds of a US interest rate increase taking place in the summer bolstered demand for the commodity-driven ‘Loonie’ in spite of a lack of domestic data.
As of Wednesday, 8th April 2015, the Pound Sterling currency rates mentioned within this news item were as follows:

GBP EUR exchange rate was 1.3796, GBP USD exchange rate was 1.4877, GBP AUD exchange rate was 1.9354, GBP NZD exchange rate was 1.9695, and GBP CAD exchange rate was 1.8658.
Dominic Lee About Author: (421 Posts)With over ten years experience as an economist – including four years spent as a chief economist with a major currency broker – Dominic has acquired a wealth of knowledge which he uses to forecast market movements. Dominic now works as an independent business advisor and writes for several financial publications.

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