USD has taken somewhat of a backseat as focus has turned to the Coronavirus outbreak and the European Central Bank’s announcements will see most of the attention today. The United States’ main news comes from President Trumps impeachment trial, but experts suggest that this trial is not something that is going to remove him from office, but the effect will be more impactful in an election perspective. Meanwhile, the GBP continues to fare well against most of its major rivals including the USD. After recent positive labour market reports, the UK currency is on an upward trend and will be hoping that it will continue going into tomorrow’s PMI data release.
USD Remains Side-Lined as Other Global Events Take the Mainstage
The USD has little to report going towards the latter end of the week. The main news event coming from the US is the impeachment trial of President Trump. Though experts note that this trial will not remove the President from office, but it will do some damage to his upcoming election campaigns. The trial is likely to have little impact on the USD so attention has turned to its counterparts in the global market as events unfold across the world.
The ECB is set to meet later today to discuss recent economic activity. The market is expecting the ECB to pick up on a rise in inflation figures and that the manufacturing cycle has bottomed out. But it is unlikely that the ECB meeting will have much effect on the EUR/USD exchange rates. Economists at ING suggest that the main focus of the meeting will revolve around the launch of the strategy review, specifically in relation to the duration. Their economists also note that the review will likely lead to a new definition of price stability of “around 2%” from “below but close to, 2%”. The meeting should also give markets another opportunity to asses ECB President Christine Lagarde’s communication style, with her previous first few months described as giving a balanced rhetoric.
GBP Continues Its Storm of the Markets as It Eagerly Awaits Friday PMIs
Going into Thursday, GBP remains a well-performer. Its recent success in its labour market data saw the currency rise above many of its rival currencies including the USD. It still has another hurdle in front of it in the form of tomorrow’s PMI data which could make or break the GBP. Positive data could see the currency continue its upward trend, but any negativity could see the recent turnaround reversed.
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