Pound Pushing Higher As Wednesday’s Unemployment Report Looms
The Pound is on course to reach a two-week high against the Euro as economists speculate that today’s CBI Business optimism Index climbed to its highest-level in 20-years during the last three months of 2013. The currency is also finding support as investors expect that Wednesday’s UK unemployment rate data will show that the jobless rate fell closer to the Bank of England’s target of 7%.
The US Dollar had a quiet session on Monday due to US financial institutions being shut for the Martin Luther King Jr national holiday. Today will be another quiet day in terms of domestic US data so investors will be looking ahead to Wednesday’s mortgage and chain store retail sales data. Thursday sees the release of the latest continuing jobless claims data and will see the publication of existing home sales and manufacturing PMI reports. If those reports come in positively then we can expect the US Dollar to revert back to pushing higher.
The Euro is softer against the Pound and US Dollar as investors await the publication of the ZEW institutes latest bout of sentiment reports for the Eurozone and Germany. The currency is likely to strengthen if the reports come in as strongly as forecast.
The ‘Aussie’ is trading steadily against its U.S. counterpart in subdued trade on Tuesday, as expectations that the Federal Reserve will continue tapering its stimulus program at next week’s policy meeting continue to support the ‘Greenback’ and weigh on the Australian currency.
New Zealand Dollar
The New Zealand Dollar surged against the US Dollar, Sterling and other major peers after data showed that inflation in the country increased unexpectedly in December. As a result investors increased their bets that the Reserve Bank of New Zealand could begin hiking interest rates by as soon as next week’s policy meeting.
The Canadian Dollar could recover ground today if manufacturing sales data comes in positively. Concerns are mounting that the Canadian economy is beginning to slow so any sign of improvement is likely to allay some of those concerns.
South African Rand
The Rand remains under pressure after members of the Association and Mineworkers and Construction Union called for a 48-hour strike at South Africa’s Platinum and Gold mines. The currency found some breathing space yesterday due to the lack of US data and muted trading activity.
Disclaimer: This update is provided by TorFX, a leading foreign exchange broker, its content is authorised for reuse by affiliates.
Pete Southern is an active trader, chartist and writer for market blogs. He is currently technical analysis contributor and admin at this here blog.
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