(EUR/USD) Hopes Of A Hawkish ECB Shows Favour To The Euro, (EUR/GBP) UK CPI Inflation Data Knocks The Pound Sterling - Good Morning Forex!
Rebecca Duthie 18.05.2022 13:55
The Euro claws back marginally against the USD.
UK CPI inflation data knocks the Pound Sterling against both the Euro and The USD.
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EUR showing signs of potential recovery
Market sentiment for this currency pair is showing bullish signals on Wednesday. The Euro gained 1.1% on the USD overnight, however it lost more than 0.3% during the trading day on Wednesday. In general, investor confidence has been returning to the market, this has been helped by the fact that U.S retail sales rose in April.
It seems as though the Fed will continue to tighten monetary policy in conjunction with expectations that the European Central Bank (ECB) will turn hawkish after representative Klaas Knot suggested an interest rate hike is on the table.
EUR/USD Price Chart
UKs CPI Inflation knocks the Pound Sterling
The market sentiment for this currency pair is showing bearish signals. The Euro has gained on the GBP after UKs headline CPI inflation rate came out at 9% for April, which beat market expectations, however is still up 2% from March. The most recent data for the UK economy did not shock the markets, therefore, the long-term effect of this data is unlikely to have a big effect on the Pound Sterling. At the last policy-setting meeting, the Bank of England (BoE) pushed interest rates up by 1%, the recent CPI inflation data suggests that the BoE will likely need to continue tightening their monetary policy.
EUR/GBP Price Chart
USD/CAD currency pair
The USD/CAD currency pair is signalling bearish market sentiment, this bearish sentiment is not expected to continue for long in the future. With the hawkish Fed fighting inflation, the USD is expected to get stronger going forward.
USD/CAD Price Chart
Pound Sterling loses to the US Dollar
The market sentiment is showing bullish signals for this currency pair, however the GBP has weakened against the USD on Wednesday. The weakening of the Pound Sterling comes after the release of CPI inflation data.
GBP/USD Price Chart
Read next: (EUR/USD, EUR/GBP, EUR/CHF) ECBs Hint To Raise Interest Rates Offers Some Relief For The Euro - Good Morning Forex!
Sources: finance.yahoo.com, dailyfx.com, poundsterlinglive.com