Summary:
- US forex and stock markets await labour statistics.
- The UK economic outlook shocks the market.
- CHF weakens further.
EUR shows slight strengthening against the US Dollar
The price of the EUR/USD currency pair has increased since the market opened this morning. The strengthening of the Euro comes as the market awaits the release of the latest nonfarm payrolls data due from the U.S. Bureau of Labour Statistics, which are expected to have decreased over the past month. If there were any chance of the labour crisis being improved, the Fed may slow on their aggressive monetary policy.
The market sentiment for this currency pair is mixed, investors are awaiting the announcement from the Bureau of Labour Statistics, if the results are favourable, we could see the US Dollar strengthen even more, if the results are below market expectations, we could see the EUR temporarily strengthen further against the US Dollar during the trading day.
EUR/USD Price Chart
GBP weakens against the EUR
Market sentiment is showing bullish signals for this currency pair. On Thursday the Bank of England (BoE) announced their May economic forecast, which reflected a bleak picture. The BoE forecasted inflation to reach around 10% by the end of the year, along with expectations that the UK economy will slow, this forecast made the market turn away from the GBP. In the current economic environment, it is likely that other economies will face the same issues as the UK.
EUR/GBP Price Chart
CHF continues to weaken against the USD
This currency pair is showing bullish market signals for the future. The US Dollar continues to strengthen against the Swiss Franc, the hawkish Fed and dovish SNB are factors driving investors to be net-short.
USD/CHF Price Chart
USD shows strength against the GBP.
The GBP has weakened substantially against the USD in the past 24 hours. The Weakness of the pound sterling is reflective of the fact that the market and the Bank of England (BoE) have differing views of where they believe interest rates are going. Despite the BoE announcing that more interest rate hikes are on the way, markets have still reflected their lack of confidence in the currency. The hawkish Fed continues to drive the US Dollar's strength.
GBP/USD Price Chart
Sources: finance.yahoo.com, bankofengland.co.uk, dailyfx.com, poundsterlinglive.com