Currency news

Riksbank, risk event today

Thanim Islam
Profile
Head of FX Analysis at Equals Money
-
3
min read
Publish date
08/05/24
    • Friday's job numbers add to dovish pricing on Fed rates
    • Big week for GBP, with BoE and GDP numbers this week


    Yesterday's currency recap

    As we can see below, trading was relatively subdued in the absence of any major news or data points over the course of European trading hours. Overnight with Asian equities finishing lower, demand for USD picked up, seeing both GBPUSD and EURUSD hit 1-week lows.

    Today's GBP rates

    Currency pair Daily move* Indicative rate**
    GBPAUD 0.07% 1.8973
    GBPCAD 0.08% 1.7181
    GBPCHF -0.07% 1.1378
    GBPDKK -0.20% 8.6844
    GBPEUR -0.20% 1.1643
    GBPJPY 0.25% 193.7990
    GBPNOK 0.25% 13.6420
    GBPNZD -0.22% 2.0860
    GBPSEK -0.15% 13.5715
    GBPUSD -0.13% 1.2550


    *Daily move - against G10 rates at 7:30am, 08.05.24

    ** Indicative rates - interbank rates at 7:30am, 08.05.24

    Key data points

    Currency Event Period Consensus Previous
    - None today. - - -

    Upcoming speeches

    • EUR: Wunsch, De Cos
    • USD: Fed Jefferson, Collins, Cook

    What we think

    Another quiet economic calendar today, with the only possible market mover being the Riksbank (Swedish central bank) monetary policy meeting this morning. The Bank are currently expected to cut interest rates from 4% to 3.75%, a move that would highlight the difference in rate expectations between Europe and the US.

    As a result, a cut today could see further demand for USD. Client focus remains heavily on tomorrow’s BoE meeting and how the vote split will pan out. Current expectations see a 7-2 split, with members Dave Ramsden and Swati Dhingra favouring a cut. Downside risks to GBP will come in the form of either the Bank hinting at a rate cut to come in June, and/or we have more than two members favouring a rate cut.

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    About the author
    Thanim Islam
    Profile
    Head of FX Analysis at Equals Money

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