Pound (GBP) Stable as Vaccination Rollout Advances
The Pound (GBP) was rangebound during yesterday’s session after the UK government extended its vaccination programme to those aged 30 and over.
This helped to somewhat alleviate worries over a recent rise in coronavirus cases in the UK, which has been putting pressure on the Pound in recent days.
The renewed vaccine optimism was enough to help the GBP/EUR exchange rate recover from its two-week low, with the Euro sliding in yesterday’s trade.
In the absence of any noteworthy data releases, it’s likely that UK coronavirus news will remain a dominant influence on GBP exchange rates through the rest of this week.
Euro (EUR) Dented by Profit Taking
The Euro (EUR) slipped yesterday amid a risk-off market mood and some profit taking among EUR investors.
The single currency was further dented by its negative correlation with the US Dollar (USD), which caused the Euro to fall as the ‘Greenback’ rebounded from its recent weak position.
Looking ahead, EUR investors may be watching for any hints of a more hawkish approach from the European Central Bank (ECB) in a speech today from ECB Vice-President Luis de Guindos.
US Dollar (USD) Strengthens amid Risk-Off Sentiment
The US Dollar (USD) rallied through yesterday’s European trading session, as a bearish market mood rekindled demand in the safe-haven currency.
This was reinforced by remarks from senior Federal Reserve official Randal Quarles, who argued that inflation would ‘prove sufficient’ to begin tapering later in 2021, adding his voice to other Fed officials hinting at a more hawkish approach.
Turning to today, USD could find further gains when April’s durable goods orders data are released this afternoon, with forecasts predicting continued growth in manufacturing demand.
The latest US GDP estimate for the first quarter of 2021 could also boost the US Dollar if the new figures exceed the previous estimate.
Canadian Dollar (CAD) Dragged down by Drop in Oil Prices
The Canadian Dollar (CAD) slipped yesterday as the oil-sensitive currency was pulled down by a drop in oil prices, which saw WTI crude fall by as much as 1%.
Australian Dollar (AUD) Falls following Regional Lockdown Announcement
The Australian Dollar (AUD) dropped in overnight trade as an outbreak of a ‘highly infectious’ coronavirus variant triggered a one-week lockdown in Victoria, Australia’s second most populous state.
New Zealand Dollar (NZD) Buoyed by RBNZ Stance
The New Zealand Dollar (NZD) trended higher overnight, as Reserve Bank of New Zealand (RBNZ) Governor Adrian Orr reiterated the RBNZ’s hawkish outlook when he spoke before parliament’s Finance and Expenditure Committee.