Tension on The US Dollar has eased overnight as Donald Trump stepped back from earlier threats to impose tariffs if his initial plans for Greenland were blocked. Trump also for the first time ruled out the use of force which has eased concerns from investors.
All of this came off the back of comments made by Trump stating that he has reached a framework deal with NATO Secretary General Mark Rutte for Greenland and the entire Arctic Region. There is however still a concern surrounding the potential damage done for the relationship between The European Union and The U.S as ECB President Christine Lagarde walked out of a dinner during the speech yesterday. Lagarde followed this up by stating that The European economy needs a deep review in the light of a new international order.
Switching our attention to the economic calendar, focus will be on three key releases for The U.S with weekly initial jobless claims, GDP figures and November Inflation numbers all set to be released this afternoon.
Weekly Jobless Claims are set to show a further 14,000 claims from last week, whilst the growth of the economy looks to have stalled and potentially remain at 4.3%. Both these releases could weigh a little on The Dollar and potentially continue the volatility we’ve seen this week. However, the biggest influence will no doubt come from Inflation figures which The Federal Reserve use as their preferred measure when planning their path for future interest rate decisions. The previous inflation reading showed inflation being below 3%, if this was to continue lower, we could see calls for an interest rate cut, which could see more USD weakness. Whilst any growth in price rises could support The Dollar in a similar fashion to The UK reading earlier this week.
GBP/EUR 1.1486 GBP/USD 1.3437 GBP/AED 4.9376
GBP/AUD 1.9760 GBP/CHF 1.0659 GBP/CAD 1.8580
GBP/NZD 2.2916 EUR/USD 1.1683 GBP/ZAR 21.7812