Forex Market Strengthens Against USD Ahead of Key Speeches

Forex Market Strengthens Against USD Ahead of Key Speeches

Forex Market Strengthens Against USD Ahead of Key Speeches

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  • Euro recovers despite data
  • The pound is also in a stronger position
  • Markets rise on bank profits

The euro and pound both rose against the dollar today, despite a slight rise in US government bond yields on this important index day in the US and Europe. The euro shrugged off comments from ECB President Lagarde, while the pound also climbed on expectations of key statements from Fed Chairman Jerome Powell. Meanwhile, Wall Street markets appear to be getting support from strong bank results. The Dow Jones was the beneficiary, gaining over 200 points at the time of writing.

Return to strength as euro overcomes negative news

Although ECB President Christine Lagarde was cautious in her speech today, the euro remains close to its highest level in three weeks against the dollar. The single currency traded near 1.1975 on the highs as traders preferred to ignore the ECB chief’s comments and adopt a more positive stance despite slightly disappointing economic indicators and Denmark’s announcement that it would suspend its vaccine program with AstraZeneca.

This decision comes at a time when the link between Oxford-Astrazeneca’s COVID-19 vaccine continues to be established, albeit in very rare cases, with cases of blood clotting. The decision comes just one day after the United States, Canada and the European Union stopped using Johnson & Johnson’s vaccine for similar reasons.

Pound continues to press Ahead.

While concerns about COVID remain a factor for the UK, the pound seems to find support in the fact that the gradual reopening of the UK is still underway. Earlier this week, there were jubilant tones when large groups were able to gather and meet for the first time in many months.

The weak dollar, despite inflation data that was close to expectations, helped the pound advance further. The data showed that core prices rose 0.6% in March. This allowed the central bank to keep interest rates low, which prevented a recovery of the greenback. As the UK is already well advanced in its COVID vaccination campaign, it also suffers less from delays or setbacks.

bank results impressive as market exceeds

The decision was widely expected, but Wall Street shares rebounded Wednesday as the first earnings reports from major banks were released. The Dow Jones, NASDAQ and S&P 500 started the day with strong banks like Goldman Sachs and JP Morgan. The former exceeded revenue expectations by more than $5 billion, while the latter also exceeded profit and loss expectations.

Slightly better-than-expected inflation data could be a concern, but that’s undecided as currency traders and equity investors await the dissection of the Fed chairman’s words later today.

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