The US Dollar posted a dramatic turnaround last week erasing the gains from the previous week. Closing the week ending 25th March as the strongest currency, the US dollar was supported mostly by various Fed members’ speaking engagements who came out broadly in support of a rate hike. Economic data from the US was mixed this week as durable goods orders showed a contraction in February. However, the final revised GDP for the fourth quarter of 2015 was yet again, revised higher to 1.40%, from 1.10% revision in the second quarter. Despite a thin holiday trading on Friday, the Dollar managed to bounce higher closing the week with gains.
Weekly Spot FX Performance – 25/03/2016 (Source: Finviz.com)
The British Pound made up the tail end of the scale, losing -2.35%. The declines came on political developments in the UK with Brexit being the core. Last week’s terror attacks in Brussels also saw the GBP being hit hard as uncertainty on the Brexit outcome prevails. Economic data from the UK was disappointing with inflation in February rising at the same pace as in January at 0.30%, below estimates of 0.40%. Retail sales data was also weak but better than a month ago, all adding to the bearish sentiment in the British Pound.
Fundamentals for the Week 28/03 – 01/04
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