17/05/2024
Written by: Ian Morley
Summary:
GBP saw a continued decline across various markets yesterday despite the absence of significant news or data. Meanwhile, USD traded within a narrow range during the afternoon session. However, following positive earnings results from Apple last night, equity futures experienced an uptick, leading to weakness in the USD ahead of today’s job figures.
Speeches:
There are no scheduled speeches for today.
Market Insight:
Following the recent Federal Reserve meeting on Wednesday, today’s job figures will be closely watched to gauge whether the data aligns with the possibility of a Fed rate hike later this year. If the numbers support this notion, it could mark the beginning of the 15-year seasonal trend where the USD tends to perform well during May. Conversely, if the job market shows signs of softening, it could prompt movements beyond resistance levels on GBPUSD and EURUSD. Market expectations are for 240,000 job additions in April, a decrease from the 303,000 recorded in March.
Analysis:
While past performance does not guarantee future outcomes, it’s worth considering seasonal trends when assessing their potential impact on foreign exchange rates. For instance, GBP has historically tended to decline against USD in May in 12 out of the past 15 years, while USD has generally outperformed during the same period. With Federal Reserve Chair Powell indicating that current data does not support a Fed rate hike, today’s job figures may contribute to a downward movement in GBPUSD.