Published: 02/05/2024 By ECAP
The pound saw a gentle pushback against the dollar, helping GBPUSD continue to recover from its slump in late April. The improvement is mostly due to Dollar weakness, following comments from Fed Chair Powell and his expectation for inflation to fall over the next year, with further rate hikes “unlikely”. The UK data schedule is quiet for the remainder of this week.The Euro received support during yesterday’s trading, both pre and post-Fed update. With markets still weighing up the possibilities of a June or July rate cut from the ECB, the short-term gains will be welcomed by Euro sellers. The remainder of this week is a quiet one for the Eurozone, however, the US employment data poses some risk to EURUSD.
Last night the Fed kept rates unchanged as expected, however, due to a less hawkish rhetoric from Jerome Powell, the rate cut expectations have been adjusted lower, with 35bps worth of cuts now priced in – 5bps less than yesterday morning. Employment data is next in line for the US, with non-farms and unemployment data out tomorrow – always a potential market-moving data release.
Data supplied by GC Partners