Your End of Quarter Report
Welcome to April and the start of Q2. Last quarter saw the Euro dip to new lows against all major currencies and underperform hugely. Its decline was a welcome relief to most European nations as it is helping alleviate deflationary pressures and assist export and growth. With quantitative easing having finally been introduced, it remains to be seen whether the Euro will bounce back. The European economy looks to have turned a corner with unemployment peaking and falling inflation slowing down but we are coming from a very poor position and the shadow of the Greek crisis continues to loom large.
Sterling had a mixed quarter as it followed the trend against the Euro and weakened against the US Dollar. Data was mainly positive but the uncertainty of the General Election will most likely be the main catalyst for currency movements at the beginning of this quarter. Yesterday’s upward revision of Q4 GDP boosted Sterling and today we are looking at the final PMI manufacturing report for March. This will affect where Sterling goes today against the Dollar especially, as good results should see GBP flourish, whereas anything negative could see Sterling head south again.
The US Dollar was the major winner last quarter as “patience” was removed and an interest rate hike was placed firmly on the agenda. We are coming into jobs season in the US, where we have a raft of data coming in over the next three days culminating in the old favourite, Non Farm Payrolls. Today, we have the ADP Employment Change which has been healthy for a long time and seen as an indicator of the NFP.
Have a good day/month/quarter!