The Pound managed to make more gains against the Euro on Wednesday as investors awaited the release of minutes from the Bank of England’s latest policy meeting. Also due for release is the latest UK unemployment and claimant count data. Gains for the currency are likely to be muted and movement will depend upon market confidence ahead of Thursday’s Scottish Independence referendum.
The US Dollar was holding steady against its major peers prior to the conclusion of the Federal Reserve’s monetary policy meeting. The US Central Bank is expected to taper its monthly bond-buying programme by another $10 billion, a move that would keep the Fed on track to end the programme entirely in October. The markets will also be keeping a close eye on a press conference to be held by Fed Chair Janet Yellen.
The Euro softened on concerns that the Ukrainian ceasefire is coming under intense strain as pro-Russian rebels questioned further peace talks with the Ukrainian government. Some rebel leaders called for a renewed offensive as fighting continues near Donetsk. Tuesday’s disappointing economic sentiment data for Germany and the wider Eurozone was also weighing.
The ‘Aussie’ remained lower against the US Dollar and Pound as demand for the US currency fluctuated ahead of the Federal Reserve’s latest policy meeting and as the markets await the release of the latest Bank of England minutes.
New Zealand Dollar
The New Zealand Dollar made gains against its Australian relation but remained lower against several other peers after official data showed that the nation’s current account deficit narrowed to NZ$ 1.06 billion in the second quarter of the year. Economists had been expecting the current account deficit to narrow to NZ$0.95 billion in the last quarter.
The ‘Loonie’ advanced against several rivals after it found support from comments made by Bank of Canada Governor Stephen Poloz, the announcement of new stimulus measures by China’s central bank and a strong manufacturing sales report.
South African Rand
The Rand remained under pressure on Wednesday as investors focused on upcoming events in the US. The currency continued to be weaker even as news broke that the Chinese Central Bank was considering introducing new stimulus measures. Investors will also be looking to the release of the latest domestic Consumer Price Index data.
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