While the GBP/USD pairing edged away from an almost four-year high after UK growth reports failed to live up to expectations, the Pound recovered losses against the ‘Greenback’ during the North American session.
Sterling was also supported as Bank of England Governor Mark Carney asserted that the UK recovery ‘is starting to broaden out’ and that the MPC is ‘prudently optimistic’ about the nation’s outlook.
With the Federal Open Market Committee policy meeting looming and US growth data due for publication tomorrow, a report revealing an unexpected decline in US consumer confidence weighed on the US Dollar as local trading got underway.
The Conference Board’s index was forecast to have achieved 83.2 in April.
However, the measure of sentiment actually slid from a positively revised 83.9 in March to 82.3.
Lynn Franco, the Conference Board’s director of economic indicators, issued the following statement with the figure; ‘Consumer confidence declined slightly in April as consumers assessed current business and labour market conditions less favourably than in March. However, their expectations regarding the short-term outlook for the economy and labour market held steady’.
An index of present conditions slumped from 82.5 in March to a three-month low of 78.3 in April while the consumer expectations measure shifted modestly from 84.8 to 84.9.
Meanwhile, separate US data showed that property prices faltered in February, with the S&P/Case-Shiller index showing a 12.9 per cent annual increase in February following a 13.2 per cent year-on-year gain the previous month.
Although the GBP/USD pairing could hold gains overnight, considerable currency movement can be expected to occur tomorrow as a result of US growth data and the FOMC announcement.
The world’s largest economy is expected to have grown by 1.2 per cent in the first quarter of 2014, year-on-year – down from annualised growth of 2.6 per cent in the previous three months.
The ADP employment change report will also be of particular interest tomorrow as it may provide some insight into Friday’s US non-farm payrolls figure.
UK data is thin on the ground until Thursday when UK house price and manufacturing figures are due for release.
US Dollar (USD) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
US Dollar,
,Pound Sterling,0.5942,
US Dollar,,Canadian Dollar,1.0957,
US Dollar,,Euro,0.7234,
US Dollar,,Australian Dollar,1.0776,
US Dollar,,New Zealand Dollar,1.1743,
Canadian Dollar,,US Dollar ,0.9111,
Pound Sterling,,US Dollar,1.6829,
Euro,,US Dollar,1.3822,
Australian Dollar,,US Dollar,0.9274,
New Zealand Dollar,,US Dollar,0.8547 ,
[/table]
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