Sterling Maintains Gains

Sterling picked up as the dollar softened on under-forecast data Friday. A light calendar today leaves attention on tariff headlines.

Previous Day's Market Highlights

The dollar fell after the March jobs report missed estimates. Although wage growth picked up in line with estimates, the Unemployment Rate again held at 4.1% (nevertheless the lowest the rate has been since December 2000) and the number of jobs added to the economy was only 103K versus estimates of 185-190K. The notable miss led to the afternoon’s dollar weakness, which saw euro-dollar back up towards 1.2280 and sterling-dollar back up towards 1.41. Despite morning lows around 1.3975, cable ended the day back in its now familiar 1.40-1.41 band.
 
The other main event of the day was the reignition of trade war concerns on fears that tensions between the US and China were escalating further. Fed Chair Powell spoke after the European close and was upbeat on the economy; there were no major surprises in his comments.
 
The Canadian dollar briefly gained against the pound as Net Employment Change came in above forecasts but then lost ground as the pound benefited from dollar weakness. This pushed sterling-loonie back above 1.80.

Currency Pairing 08:00 Today Vs 08:00 Yesterday Four-Week High Four-Week Low % Change
GBP/EUR 1.1483 1.1538 1.1240 2.58%
GBP/USD 1.4099 1.4245 1.3814 3.03%
EUR/USD 1.2278 1.2477 1.2218 2.08%
GBP/AUD 1.8329 1.8509 1.7599 4.92%
GBP/NZD 1.9307 1.9644 1.8925 3.66%
GBP/CAD 1.7999 1.8417 1.7742 3.67%

Today's Market Highlights

The calendar is largely quiet today ahead of a fairly light week overall. Canada releases housing data and the Bank of Canada’s Business Outlook Survey this afternoon. ECBboard member Constâncio speaks at the presentation of the ECB Annual Report 2017 (14:00 BST).
 
The key release from the UK is Wednesday’s production data. March US CPI figures are also out Wednesday ahead of the Fed’s meeting minutes, while for the euro attention will largely be on Thursday’s ECB monetary policy meeting accounts. Investors will closely watch both sets of central bank meeting minutes for any additional policy guidance.
 
In addition, investors will continue to keep a close eye on the latest tariff headlines, which could continue to see market volatility, particularly in equities.  

Today's Economic Calendar

Time Currency Release Consensus Previous
13:15 CAD Housing Starts s.a. YoY (Mar) 218.0K 229.7K
14:00 EUR ECB's Constancio Speaks
15:30 CAD BoC Business Outlook Survey

Caxton