Pound volatile as investors respond to BoE decision

Australian Dollar (AUD) slips as business confidence drops

Yesterday, the Australian Dollar (AUD) continued to weaken against its peers after a survey from NAB reported that business confidence fell at the end of last year.

Sentiment amongst Australian businesses deteriorated in Q4 2023, as the Reserve Bank of Australia’s (RBA) restrictive policy took hold. This, paired with bets on interest rate cuts from the RBA, dented AUD.

This morning, PPI data for the fourth quarter of 2023 is due for release. Markets are anticipating a sharp cooldown, which may weigh on the ‘Aussie’ over the session.

New Zealand Dollar (NZD) blighted by falling AUD

The New Zealand Dollar (NZD) weakened yesterday, due to its close ties to the Australian Dollar.

Due to a lack of domestic data releases, the ‘Kiwi’ was left vulnerable to market dynamics, resulting in losses against most peers.

Today, the New Zealand Dollar may see volatile trade as markets analyse the latest consumer confidence data.

Pound (GBP) rocked by BoE decision

The Pound (GBP) was volatile yesterday as markets were caught off-guard by the Bank of England’s (BoE) latest interest rate decision.

Two of the nine policymakers at the BoE voted for a rate hike, with this hawkish development initially boosting GBP. However, a slightly more dovish tone from BoE Governor Bailey slashed Sterling’s gains.

Continued analysis of yesterday’s BoE decision could drive the Pound during today’s trade, perhaps leading to more wavering movement.

Euro (EUR) choppy amid varying data

The Euro (EUR) endured fluctuating trade over Thursday’s session, amid a mixed slate of economic data.

Inflation cooled in line with expectations, which served to bolster interest rate cut bets. However, the common currency was underpinned by the Eurozone’s unemployment rate holding at a historic low.

Data releases are set to thin out today, which may prevent the Euro from finding its footing.

US Dollar (USD) retreats amid rising jobless claims

After a strong start following hawkish sentiments from Federal Reserve Chair Jerome Powell, the US Dollar (USD) faded over the day’s trade.

Later on, US jobless claims for the week ending 27 January printed above expectations. This fuelled speculation of slowing US employment, thereby weighing down on the ‘Greenback’.

Tonight, the latest non-farm payrolls reading is due to print. Economists anticipate a fall in the number of jobs created in January, which may weaken the US Dollar.

Canadian Dollar (CAD) muted despite improving manufacturing activity

The Canadian Dollar (CAD) was largely rudderless during yesterday’s session, despite forecast-beating manufacturing data and rising oil prices.

Oil price movements are likely to be the main source of movement for the ‘Loonie’ today. If prices recover, CAD may strengthen.

Data Releases

Feb 2nd 10:30 AUD PPI (Q4) 0.6%
Feb 2nd 23:30 USD Non Farm Payrolls (Jan) 180,000