Risk sentiment soured on Friday as tensions over the Russia-Ukraine conflict appeared to get worse. In a televised address from the White House, President Joe Biden claimed the US had “reason to believe” that the Kremlin are “planning to and intend to attack Ukraine in the coming week, in the coming days”. Biden went on to add that he was “convinced” that Vladimir Putin has already “made the decision” to invade Ukraine. Despite these claims, Biden said Russia still have the chance to “choose diplomacy”, noting that he believed it was “not too late to de-escalate and return to the negotiating table”. The Dollar strengthen on Friday as investors turned to safe-haven assets in this time of uncertainty. Cable ended up finishing the week back below 1.36, and EURUSD slipped back below 1.1350.
GBPUSD started Friday well trading at 1.3624 – still upbeat from the markets expectation of an incoming Bank of England rate hike. But as geopolitical tensions worsened, as did the Sterling’s performance. Cable finally finished the week at 1.3588.
GBPEUR in contrast made subtle upside moves on Friday. The pair opened at 1.1981 and closed at 1.1988.
EURUSD recorded a loss on Friday despite still trading in a tight range. The pair started at 1.1371 and finished the week at 1.1334.
This morning, the calendar is packed with flash PMI releases. At 08:30 Germany released it February flash Composite, Manufacturing, and Services PMI’s. At 09:00, the Eurozone printed its flash Composite and Manufacturing PMI numbers. At 09:30 the UK will also publish its Composite, Manufacturing, and Services PMI’s. Composite is expected at 55, Manufacturing is forecasted at 57.2, and Services is expected at 55.5. In the afternoon, Fed member Michelle Bowman will be speaking.