United States Dollar: Cable pushes higher overnight. The Dovish tone was set by the FED on Wednesday as interest rates were kept on hold and bets on future interest rates being sooner rather than later were pinned back from the expected June meeting. This tone continued into yesterday’s session and growth figures supported this. GDP q/q posted 0.5 % versus an expected 0.7 % and against a previous 1.4 %. This showed that growth slowed to the fastest pace in 2 years and backed the bets interest rates will remain on hold for a period of time. The other noteworthy release came in the form of employment, unemployment claims to be precise and it came as a light relief to the US as it came in as expected. The growth news is what investors and markets have clung onto and cable has pushed back above 1.4600 for today’s start. GBP/USD 1.4640 – 8:45am. Middle impact data is due ahead, but nothing of real note. This does mean we are likely to see month end trading push volatility today ahead also of the UK bank holiday. There could be some profit taking on the recent Pound gains, so would be worth keeping an eye on this afternoon.
We expect a range today in the GBP/USD rate of 1.4540 to 1.4710
Euro: Data releases have been thin on the ground for the Eurozone this week and yesterday saw no change to this. Data elsewhere drove general movement, however a Greek deal edged closer on Thursday. Greece and its lenders continued talks, almost reaching a conclusion on reforms thin the current bailout programme with further contingency measures being the sticky point. These must be committed to by Greece however in exchange for debt relief negotiations. The May 9th deadline looks like it will be met. GBP/EUR 1.2850 – 8:45am. Quiet Friday session expected, in regards to data however. As mentioned in the USD commentary above, end of month and the bank holiday in the UK cannot be ignored for movement today with volatility expected.
We expect a range today in the GBP/EUR rate of 1.2790 to 1.2940
Aussie and Kiwi Dollars: Both the Aussie and Kiwi have firmed up recent moves against the Pound. As we enter into the final day’s trade for the week and month, GBP/AUD has advanced reaching an April high overnight of 1.9223. This would have been the same for GBP/NZD prior to New Zealand reserve bank chief Wheeler holding the official cash rate at the record low 2.25 percent. Sterling gains had taken the currency pair to 2.1330, but shortly after the release the Kiwi fought the Pound lower to 2.0979. The respective pairs open this morning not far from these moves. GBP/AUD 1.9142 and GBP/NZD 2.1008 – 8:45am. I am sounding like a broken record here, but anticipate end of month flows prior to the UK bank holiday weekend. Sterling gains have been quite significant against the Aussie this month and concerns are around profit taking prior to moving into May.
We expect a range today in the GBP/AUD rate of 1.9040 to 1.9260
We expect a range today in the GBP/NZD rate of 2.0840 to 2.1090
AUD: No data releases due for today
EUR: No data releases due for today
GBP: No data releases due for today
NZD: No data release due for today
USD: No data releases due for today
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