Investors losing patience over interest rate promise
On Tuesday, Federal Reserve Chairwoman Janet Yellen raised concerns over slower growth in the economy and justified a slower interest rate change to encourage spending. The impact of her dovish comments created doubts over the future of the US economy.
Positive week for the Euro
Positive data from the German and Eurozone CPI have been the driving factors behind the strengthening of EUR this week. This is good news for the Euro currency and has eased previous concerns regarding deflation levels.
Ahead of today’s US unemployment and non-farm payroll data, the USD has strengthened almost 2 cents against the Euro as forecasters expect positive outcomes. However, these remain incredibly volatile events for the US and worse than expected figures will dim hopes further of an interest rate hike, potentially strengthening the Euro against the Dollar.
USD continues to strengthen against GBP this morning
GBP has been gradually decreasing since yesterday against the Dollar off the back of poor manufacturing data released earlier this week.
We can expect this weakness to continue throughout the course of the day as Sterling is already under pressure, and should data from the US meet expectations at the very least, I think we can expect the trend to continue and as we speak. GBPUSD is trading back towards the lower end of its recent trading channel of 1.40 – 1.44, currently trading in the 1.41’s.