The market expectations of a probable U.S. interest rate increase in March were fully cemented by February’s solid NFP headline figure of 235k which illustrated steady growth in the U.S. labor markets.
Sterling bears were unleashed during Wednesday’s trading session, with the British pound/U.S. dollar currency pair sinking to a fresh seven-week low at 1.2150 as investor anxiety heightened ahead of the UK Spring Budget speech. Treasury chief Philip Hammond will be in the limelight today, and is set to provide some insight on the UK government’s financial plans as it embarks on its quest to exit the European Union.
The Euro found itself under renewed selling pressure during trading on Monday following reports of former Prime Minister Alain Juppe confirming that he was not ready to run in the French presidential election. Markets simply acknowledged this fresh development as potentially heightening the chances of Marine Le Pen winning the elections which consequently exposed the Euro to further downside losses on Tuesday.
Brexit-fuelled anxieties have exposed Sterling to sharp losses this week with sellers exploiting the rising uncertainty to attack the GBP/USD currency pair to a fresh six-week low at 1.2260 during trading on Thursday. Sentiment is turning increasingly bearish towards the Pound and the terrible combination of soft domestic economic data from the UK coupled with political risk could ensure the currency remains pressured.
Although global stocks have displayed phenomenal gains this month, the growing skepticism over the sustainability of the bull rally may encourage participants to heavily scrutinize Trump’s first speech.
Global stocks have repeatedly hit record highs, there remains some skepticism over the sustainability of the rally with a selloff on the table if Trump fails to deliver his market shaking tax cuts and fiscal policies.