IFX Market Report: Thursday 25th February 2021

The Pound was able to open above the 1.41 handle this morning, thanks to comments from Fed Chair Jerome Powell yesterday evening. Powell announced a slight shift in guidance, but it was enough of a move to force the Dollar lower against the other major G10 currencies. The “soothing” comments from the Fed were able to lower market volatility, and as risk-appetite grew, naturally the safe-haven Dollar deflated.

As the Pound continued to surge, Cable was able to open yesterday at 1.4180. The pair experienced tough volatility and demanding pressures in the session as it attempted to climb even higher. Prior to a speech from Powell that helped boost the rate, the pair finished Wednesday finally at 1.4106.

GBPEUR also faced downside pressures yesterday. After breaking into the 1.16 range, the pair struggled to capitalize and similarly to Cable, closed below where it started the day. GBPEUR opened at 1.1658 and closed at 1.1616. It is important to note that this morning the pair is trading just below the 1.16 handle.

EURUSD had a rather quiet day, as the pair eagerly awaited the comments from Powell and the Fed. The pair opened at 1.2163 and closed subtly at 1.2143.

On the data front, it’s a packed day for both the U.S. and Eurozone. Kicking off this morning we had the GfK Consumer Confidence for March from Germany, coming out at -12.9 as opposed to the forecasted -14.3. Then at 10:00 from the Eurozone as a whole we have Consumer Confidence, Economic Sentiment and Industrial Sentiment. In the afternoon we have a plethora of releases from across the pond. From 13:30 we have Durable Goods Orders MoM and GDP Growth Rate QoQ 2nd Estimate. The GDP Growth Rate is expected to come out at 4.2%, with a previous of 33.4%. Following these releases, we have the U.S. weekly Jobs Report and speeches from three Fed members; Bostic, Quarles and Williams.

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