This week the standout performer was the Canadian dollar. It has been a good few weeks for the North American currency, which was bolstered further by a string of strong data over the last few days, and as a result, was trading yesterday at 6-week highs. This week’s inflation, growth, and trade balance figures fuelled speculation that, as the economy gains momentum, we could see an interest rate hike. In the very least it effectively rules out a rate cut, which looked like a very real possibility only a few months ago. Today’s unemployment and purchasing managers’ index (PMI) figures could further fuel speculation of a hike, as they are both indicators of economic health.
The Japanese yen struggled this week, getting off to a bad start on Monday following a couple of below-forecast releases, most notably in terms of industrial production figures. This sentiment carried throughout the week. As a result, the Japanese currency was trading at January-lows against sterling yesterday.
We saw the Indian rupee drop back from 8-month highs in response to results from a technical indicator, which suggests the currency’s recent rally may have excessive, and also that we could see a decline over the coming months.
Other than the Canadian figures mentioned, it is a quiet day on the data front today.
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