Pound Sterling, US Dollar, Australian Dollar Exchange Rate Outlook ? Employment Data, US Jobless Claims Ahead

April 15, 2015 - Written by John Cameron

STORY LINK Pound Sterling, US Dollar, Australian Dollar Exchange Rate Outlook ? Employment Data, US Jobless Claims Ahead

As the European session neared its end on Wednesday, the Pound was trending in a stronger position against the Euro as demand for the common currency was a little limited in the wake of the European Central Bank’s latest interest rate announcement. Although the ECB left interest rates on hold, as expected, some of the comments issued by ECB President Mario Draghi in the press conference following the announcement put the Euro under pressure. After Draghi recovered from being attacked by a protestor, he implied that while quantitative easing appears to be supporting the Eurozone’s economy, it is too soon to consider revising or adjusting the policy plan. He also referenced the situation in Greece, saying that the country’s place in the Eurozone is in its own hands.

UK data was in short supply on Wednesday and that continues to be the case on Thursday. UK political news could encourage some movement in the Pound Sterling exchange rate, but investors are more likely to be looking ahead to Friday and the publication of the UK’s latest batch of employment/wage growth figures.

The US Dollar experienced a patchy day of trading on Wednesday. Initially, the ‘Greenback’ clawed back losses sustained following the release of below-forecast US Advance Retail Sales data. However, as the US Industrial Production figure also fell short of the mark (showing twice the decline anticipated) the US Dollar’s gains were trimmed and the asset edged lower against several of its peers. On Thursday the main cause of ‘Greenback’ movement is likely to be US initial jobless/continuing claims figures. As the Fed has linked an improving labour market to higher borrowing costs, softer unemployment claims would be US Dollar-supportive.

Finally, the Australian Dollar approached the end of a fairly rocky trading session trending in the region of 0.7617 against the US Dollar, basically unchanged from the day’s opening levels. While a slump in the Westpac Consumer Confidence gauge and sub-par Chinese industrial production/retail sales numbers pushed the ‘Aussie’ lower during the South Pacific session, the AUD/USD pairing was able to rally to a high of 0.7638 following the US production report. In the hours ahead, the Australian Dollar is likely to experience notable movement as Australia publishes its employment report for March. As it stands, the Australian economy is believed to have added 15,000 positions, resulting in an unchanged unemployment rate of 6.3%. Disappointing data would drive the ‘Aussie’ lower while a better-than-forecast result would give the commodity-driven currency a boost.

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