The Pound Sterling and Euro continue to assert strength amidst a backdrop of fluctuating global economic conditions. Recent data highlights the robust performance of the UK economy, with GDP expanding at an annual rate of 1.4% in Q4, surpassing the anticipated figure of 1.1%. This economic resilience has bolstered the Pound, which is currently trading above 1.2500 in the European session on Thursday. Meanwhile, the Euro is maintaining its upward trajectory for the third consecutive session.
In contrast, the Australian Dollar's recent vigor has shown signs of waning. The currency's earlier momentum has slightly dissipated, leaving investors to recalibrate their strategies. Simultaneously, the US Dollar faces selling pressure as investors speculate on an end to the Russia-Ukraine war. Interestingly, discussions aimed at resolving the conflict have gained traction following phone calls involving Trump, Putin, and Ukrainian President Zelensky. However, Trump's remarks suggest that peace hinges on Ukraine's NATO stance and territorial concessions to Russia.
The US financial landscape is poised for further developments with the upcoming release of the Producer Price Index on Thursday at 14:30 CET. Analysts predict that continued weakness in the Greenback could reinforce a positive market bias. Meanwhile, the Nasdaq shows potential for continued breakout to the upside as investors anticipate favorable turns in geopolitical tensions.
European policymakers are closely monitoring these shifts, particularly in light of rising trade tensions. Trump's imposition of a 25% import tariff on steel and aluminum entering the US adds another layer of complexity as Europe braces for potential economic repercussions.
The Pound Sterling benefits from an improved risk mood, buoyed by strong UK economic data. The GBP/USD pair's performance reflects this optimism, while the Euro's persistent strength underscores its resilience amid uncertainties.