The last few days have been extremely volatile for The U.S Dollar as we move into The Jackson Hole Summit with all eyes on what The Fed Reserve will mention regarding possible Rate Hikes and any Quantitive Easing measures moving forward. Over the past week we’ve seen USD gain momentum against both EUR & GBP as reports suggested that The Fed Reserve would look to intent on making an announcement for tapering in September with the aim to beginning tapering in October 2021. The Delta Covid variant has caused concern with cases rising by 1,000 + on a daily basis in some states across The U.S. However, positive manufacturing data released on Wednesday suggests this particular variant won’t in fact derail the economic recovery.
Key data releases to keep an eye out for throughout the day will be America’s GDP Growth within the 2nd Quarter, along with the weekly job’s figures. Expectations suggest the economy has performed stronger than the previous quarter, as well as continuing claims also showing a positive drop in figures. Both data releases will be crucial to the path The Fed Reserve set out on Friday and we expect The USD to be fairly volatile over the next 48 hours depending on the outcome of The Jackson Hole Summit.
The Euro this week has been weighed down mainly by disappointing economic figures from their largest contributors Germany. IFO Business climate which surveys business owners for sentiment in current and future performance came in slightly lower than previous releases as well as Consumer Confidence also showing pessimism. The key releases in the near-term for Europe are Inflation & Unemployment for Germany and Inflation for The Euro Area. Tomorrow’s Jackson Hole Summit will potentially weigh down further on the currency depending on the future plans laid out by The Fed Reserve.
GBP/EUR 1.1676 GBP/USD 1.3734 GBP/AED 5.0381
GBP/AUD 1.8926 GBP/CHF 1.2586 GBP/CAD 1.7320
GBP/NZD 1.9753 EUR/USD 1.1751 GBP/ZAR 20.425