An inverse relationship seems to exist between the BoE's rate hike and the GBP as the currency lost 1.3% against the dollar after the Central Bank announced the new rate of 0.5%. The decline of the pound comes on the back of the dovish statement from the BoE. Though the rate was raised for the first time in 10years from 0.25% to 0.5%, Gov Carney notes that further hikes will be gradual given Brexit's effect on the economy. The pound fell to 1.308 against the dollar after the announcement. The BoE also cut down its projections for economic growth to 1.7% from 1.8%. On the release front, the UK's construction PMI improved to 50.8 from 48.1 the prior period, signalling expansion in the sector. Services PMI will come in today, forecast show 53.3, a higher than forecasted Services PMI could give the pound a lift.
The FOMC minutes were as investors expected,with the Fed reiterating the December hike and temporary soft inflation numbers. The dollar retreated gains as investors await the announcement of a new Fed chair. Lower jobless claims of 229,000 wasn't enough to draw positive sentiment to the dollar. The market was waiting for President Trump to announce Jerome Powell as the new Fed chair all through Thursday. Jerome Powell is said to be favoured by President Trump as he will maintain the status quo of slow rate growth, which is in-line with Trump's aim of keeping interest rate lower and the dollar soft. Other data released include preliminary non-farm productivity at 3% higher than the prior period's 1.5% and preliminary unit labour cost at 0.5% same as analyst forecast. USD/CAD fell to 1.2805 . Investors will be looking to non-farm payroll, ISM non-manufacturing PMI, wage growth & trade balance for the direction of the dollar today.
Though EUR/USD rose to 1.1686 during the New York trading session, it stayed within the range established since the ECB policy announcement last week. The pair was last at 1.1668, with the US dollar getting most of the attention this week due to the various key risk events out of the US, in contrast to the relatively more quiet news flow about the EURO. No major economic data is expected from the Euro-area today.
The Canadian dollar posted gains against the USD as USD/CAD retraced to 1.280. Canadian employment data and trade balance will be in today, if these data fall short of analyst expectations and the US releases impressive data, the pair would move back to 1.29 levels.
The Asian session saw the AUD/USD slide down to 0.7685 given lower than expected retail sales data. Positive services PMI from China wasn't enough to return the bulls to the currency pair. The AUD has been weak against other major currencies since the release of soft inflation numbers last week.
On the commodities side, Gold posted little gains rising to 1,283 during the New York trading session, the yellow metal remains below the 1,300 psychological level. Oil prices remained in the greens with Brent crude gaining 0.35% to $60.83. OPEC's November 30th meeting will determine if the bulls will remain with oil prices.
The FOMC minutes were as investors expected,with the Fed reiterating the December hike and temporary soft inflation numbers. The dollar retreated gains as investors await the announcement of a new Fed chair. Lower jobless claims of 229,000 wasn't enough to draw positive sentiment to the dollar. The market was waiting for President Trump to announce Jerome Powell as the new Fed chair all through Thursday. Jerome Powell is said to be favoured by President Trump as he will maintain the status quo of slow rate growth, which is in-line with Trump's aim of keeping interest rate lower and the dollar soft. Other data released include preliminary non-farm productivity at 3% higher than the prior period's 1.5% and preliminary unit labour cost at 0.5% same as analyst forecast. USD/CAD fell to 1.2805 . Investors will be looking to non-farm payroll, ISM non-manufacturing PMI, wage growth & trade balance for the direction of the dollar today.
Though EUR/USD rose to 1.1686 during the New York trading session, it stayed within the range established since the ECB policy announcement last week. The pair was last at 1.1668, with the US dollar getting most of the attention this week due to the various key risk events out of the US, in contrast to the relatively more quiet news flow about the EURO. No major economic data is expected from the Euro-area today.
The Canadian dollar posted gains against the USD as USD/CAD retraced to 1.280. Canadian employment data and trade balance will be in today, if these data fall short of analyst expectations and the US releases impressive data, the pair would move back to 1.29 levels.
The Asian session saw the AUD/USD slide down to 0.7685 given lower than expected retail sales data. Positive services PMI from China wasn't enough to return the bulls to the currency pair. The AUD has been weak against other major currencies since the release of soft inflation numbers last week.
On the commodities side, Gold posted little gains rising to 1,283 during the New York trading session, the yellow metal remains below the 1,300 psychological level. Oil prices remained in the greens with Brent crude gaining 0.35% to $60.83. OPEC's November 30th meeting will determine if the bulls will remain with oil prices.
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