Another week for the markets after one that included 4 Central Bank Interest Rate announcements and a lot of trend reversals. USD in particular changed course after 10th March NFP data and the subsequent rate hike that occurred as widely expected. The US FED, expressed a cautious optimism over the economy in the US, which alerted traders who started taking profits on long USD positions, which meant less demand, thus the reversal in the Dollar value.
Fed members’ speeches during the week will give the central bank the chance to add more clarity into the FOMC statement and Chair Yellen’s press conference.
Also last week, the Bank of England held interest rates at 0.25% while the minutes from the policy meeting showed that members discussed raising rates if inflation is going to accelerate in the future. One BoE member voted for a rate hike as she felt inflation was rising quickly and would remain above the BoE’s target for at least 3 years. This gave a boost to the GBP which bounced from 1.2107 to a 3 week high 1.2415.
EURUSD also gained over 1.3% last week, having traded as low as 1.0600 but trading at time of writing at 1.0770. AS mentioned, the rate hike from the FED was largely priced in so further USD strength run out of steam.
GOLD gained over 2% during the last week. Gold is exchanging hands at $1234 after having dropped as low as $1197 last week as the Dollar fell. Political risk with a potential trigger of Article 50 in the coming week is making the metal an attractive safe haven.
The event calendar is empty today so trading is expected to be mostly technical based.