Dollar Holds Gains as Month Ends

The dollar gained as month-end nears and Q4 GDP was revised higher. German HICP and US PCE are in focus today.

Previous Day's Market Highlights

The dollar made further gains against both the pound and the euro yesterday. Q4 growth was revised up to 2.9%, higher than forecasts of 2.7%, and supported greenback strength in the afternoon and overnight sessions.  
 
Euro-dollar fell towards 1.23 to three-day lows, and sterling-dollar fell below 1.41 for the second consecutive day. While cable managed to hold above the previous day’s lows during the European session, it inched further below 1.41 overnight. Sterling-euro continued to trade above 1.14 and failed to repeat the previous day’s excursion into the 1.13 range.
 
After rising to a new high since the referendum, around 1.85, sterling-Aussie retreated over 0.6%.

Currency Pairing 08:00 Today Vs 08:00 Yesterday Four-Week High Four-Week Low % Change
GBP/EUR 1.1419 1.1538 1.1150 3.36%
GBP/USD 1.4052 1.4245 1.3711 3.75%
EUR/USD 1.2307 1.2477 1.2154 2.59%
GBP/AUD 1.8311 1.8509 1.7599 4.92%
GBP/NZD 1.9532 1.9644 1.8914 3.72%
GBP/CAD 1.8152 1.8417 1.7617 4.34%

Today's Market Highlights

The UK releases its own final estimate of Q4 growth this morning (09:30 BST). An unrevised figure could have a muted market impact, while any revisions higher could see some sterling strength. A pick-up in German HICP could provide some support for the euro this morning. A higher Core PCE reading and continued month-end demand may see the dollar remain relatively supported.
 
Investors will continue to keep an eye on any headlines, particularly regarding new developments in US trade relationships or Brexit discussions. Today marks one year to gountil the UK leaves the EU.
 
Friday and Monday are Bank Holidays in the UK. The morning report will return on Tuesday.

Today's Economic Calendar

Time Currency Release Consensus Previous
09:30 GBP GDP YoY (Q4) 1.4% 1.4%
09:30 GBP GDP QoQ (Q4) 0.4% 0.4%
09:30 GBP Net Lending to Individuals MoM (Feb) £4.8B £4.7B
13:00 EUR German Preliminary Hamonised Index of Consumer Prices YoY (Mar) 1.6% 1.2%
13:30 USD Personal Consumption Expenditure - Price Index YoY (Feb) 1.7% 1.7%
13:30 USD Core PCE - Price Index YoY (Feb) 1.6% 1.2%
13:30 USD Personal Spending (Feb) 0.2% 0.2%
13:30 USD Personal Income MoM (Feb) 0.4% 0.4%
13:30 USD Initial Jobless Claims (23 Mar) 230K 229K
13:30 CAD GDP MoM (Jan) 0.1% 0.1%
14:45 USD Chicago Purchasing Mangers' Index (Mar) 62.0 61.9
15:00 USD Michigan Consumer Sentiment Index (Mar) 102 102
18:00 USD Fed's Harker Speaks

Caxton