United States Dollar: US Non-farm payrolls printed stronger than expected on Friday and the dollar strengthened yet again. 295,000 jobs were added to the US economy in February vs. expectations for 240,000 while the unemployment rate dropped to 5.5%. It was a solid report to say the least and GBP/USD gapped from 1.5203 to 1.5131 on the news. It then continued to be sold off throughout the afternoon and eventually came to a rest at 1.5031. The latest set of figures indicates that the Fed is on track to change their language on monetary policy this month and so to raise interest rates sometime between June and September this year. That said, wage growth and the low level of global inflation still pose a problem for the Fed and it will make for a very interesting statement on 18th March. GBP/USD has recovered a little overnight to open this morning at 1.5090. The calendar is a little quiet this week – the two main events will likely be UK Manufacturing Production on Wednesday and US Retail Sales on Thursday. BoE Governor Carney is due to speak in between.
We expect a range today in the GBP/USD rate of 1.5030 to 1.5180
Euro: EUR/USD slumped further on Friday afternoon following the US jobs report. It fell to a low of 1.0817 as the week came to an end, a new eleven and a half year low. The pair has recovered a little bit since, just on the back of some mild profit taking, and it opens in London at 1.0875. There isn’t a lot on the calendar this week to suggest the future looks much rosier for the single currency either and so a new range could well be carved out below 1.10 over the next few days. The euro is weak across the board too and GBP/EUR opens this morning at 1.3875, this after having made a brief attempt to break through 1.39 late last week.
We expect a range today in the GBP/EUR rate of 1.3810 to 1.3900
Aussie and Kiwi Dollars: Both AUD/USD and NZD/USD took a hit on Friday after the US jobs data, falling to .7682 and .7318 respectively. Attention this week will turn to the RBNZ interest rate announcement and statement. No change in policy is expected but there’ll no doubt be various warnings regarding the threat that rising house prices pose and the problems caused by the contrasting fall in the rate of global inflation.
We expect a range today in the GBP/AUD rate of 1.9430 to 1.9625
We expect a range today in the GBP/NZD rate of 2.0360 to 2.0530
AUD: NAB Business Confidence
EUR: Eurogroup Meetings
GBP: BRC Retail Sales Monitor y/y
NZD: REINZ HPI m/m
USD: Labour Market Conditions Index m/m
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