This morning, the pound is holding the gains from yesterday’s rally which saw its biggest one day gains since April 2017. Brexit optimism, hawkish rate hike comments and the weaker dollar have combined to push the GBP/USD above the 1.3000 level. The GPY/JPY is showing more follow-on momentum this morning, testing the 147.00 resistance level from below. Meanwhile, the EUR/GBP is making a tentative rally after two days of solid losses that brought the pair back towards the October lows.
The pound’s gains have certainly been amplified by the weak dollar which has fallen on hopes for a US-China impasse, while US ISM dropped more than expected.
The AUD/USD is capitalising, with follow-on buying this morning despite below par retail sales. The AUD/USD is up 0.5% this morning and 2.2% on the week.
The EUR/USD is also higher so far, after lagging yesterday.
The USD/CAD fell back despite oil prices continuing their decline from the highs. The Canadian dollar is reversing some, though by no means all of October’s gains against the Greenback.
The USD/CHF reversed from the highs, though managed to hold the 1.0000 parity line.
While came under attack yesterday, this morning, it’s the yen that’s showing the strain this morning. The USD/JPY is on the rise despite dollar weakness, with the AUD/JPY rocketing higher to test 82.00. The EUR/JPY is also building on yesterday’s gains.
UK construction PMI is at 09.30.
Today is all about US payroll figures at 12.30, with non-farm employment change, average earnings and the unemployment rate.
Canadian employment data is released at the same time alongside Canadian trade balance.
The USD/CHF held the parity line yesterday, which could be significant ahead of NFP. While the jobs data (or the reaction to it) is an unknown, any hints of dollar positivity could see the USD/CHF consolidate above 1.0000.