USD makes gains on manufacturing data

Whilst many countries were on annual Easter holidays on Friday and Monday, The US markets continued to operate, as did many of the Asian markets. After the US published a stronger-than-expected manufacturing survey, posing questions over whether the Federal Reserve would delay any interest rate cuts, The US dollar made gains across the board. The?GBP/USD?rate is down to $1.2550 this morning and the?EUR/USD?rate is also down at $1.0725. Jerome Powell, the chairman of the US Federal Reserve confirmed on Friday that the Fed would like to see much lower inflation rates before acting to reduce the cost of borrowing in the US. Any strong economic data is likely to cause investors to push out the expectations of the date of the first interest rate cut on the extension of the current high yield levels continues to make the US dollar an attractive bet for international investors. As far as the USD is concerned, the big ticket items this week include a speech by Mr Powell on Wednesday and the employment report for March, which will be published on Friday.

Sterling holding on except against the USD

We had two pieces of news to start sterling's April activity, according to Nationwide, house prices rose 1.6% in the year to March. That was better than the February figure of 1.2% but a little shy of the market expectation of 2.4%. We also had soft data from the British Retail Consortium but the forecast for this morning's manufacturing sector purchasing managers index is rather positive and could see the survey produce a positive (above 50) reading for the first time since July 2022. That should give the pound a fillip but sterling has been holding its own generally against everything except the US dollar, for all the reasons stated above. The?GBP/EUR?rate is still just shy of €1.17 and sterling is still around 1.9340 against the Australian dollar and 2.11 against the Kiwi dollar. The?GBP/CAD?rate has tracked the US dollar and that pair is down to 1.7030 right now.?

Todays Major Economic Releases

EUR - 12:00 -?Consumer Price Index (MoM)(Mar)

USD - 13:00 -?Factory Orders (MoM)(Feb)?

Interbank Exchange Rates