A sharply better-than-expected US Nonfarm Payrolls report wasn’t enough to keep the Dollar from falling versus major FX counterparts, and the Greenback looks at risk of further declines as key fundamental factors favor weakness.
The three-pronged development of higher core CPI, improved PMI surveys, and increased excess liquidity reduces any immediate need for substantive action, like the unveiling of QE. The ECB must now partake in a careful balancing act, as its dovish policy responses are limited even as President Mario Draghi pays lip service to the hope for a weaker Euro.
Gold prices are softer on the week with the precious metal off by 0.42% to trade at $1300 ahead of the New York close on Friday. The week was marked by continued weakness in gold prices as equities rallied into fresh record highs.
The long-term outlook for the AUD/USD remains bearish as the pair carves a lower high in April, and the Australian dollar remains at risk of facing a larger decline in the week ahead should the Reserve Bank of Australia (RBA) adopt a more dovish tone for monetary policy.
The pound has finished out an impressive month and week. Through April, the currency has advanced against all of its major counterparts.