North American Summary and Highlights 19 Apr
Overview - After risk appetite recovered early, the main move was a weaker GBP, more on dovish comments from BoE’s Ramsden than weak UK retail sales data.
North American session
The main move in the North American session was a weaker GBP, encouraged by BoE’s Ramsden expressing greater confidence that inflationary persistence was easing and that the balance of risks had oved to the downside. GBP/USD fell by a big figure to 1.2370. EUR/USD was dragged down to 1.0611 before recovering to around 1.0650 as EUR/GBP moved above .86.
USD/JPY held firm around 154.60 and the commodity currencies had little direction. There was no US data but the normally dovish Fed’s Goolsbee stated that the latest three months of inflation data could not be dismissed.
European morning session
A quiet European morning session saw a modest risk recovery, with the riskier currencies all edging higher against the USD, JPY and CHF. EUR/JPY gained around half a figure to 164.70, based on EUR/USD and USD/JPY both rising around 20 pips to 1.0660 and 154.50 respectively. There were similar gains for the AUD, CAD and GBP, although CAD lagged a little and GBP and AUD slightly outperformed.
UK retail sales data early in the session was slightly weaker than expected, coming in flat on the month, but had no real FX impact with the underlying trend remaining similarly flat in what is quite a volatile series.