USD on the move again!
Traders in London and pushing the USD to fresh limits again, safe in the knowledge that strong rate differentials, demand from emerging markets with debt and the lack of a viable alternative all in its favour.
This week started off with a sharp buying spree which set off the sharp gains seen and this has prompted a move to new highs against some of its key counterparts.
Looking across the board, it is hard not to see a EUR/USD push towards the next key level of support seen ahead of 1.1100, and Cable is also in decline having taken out 1.2950-30 support and now heading towards stronger levels seen ahead of 1.2800.
In recent trade, we have also seen the AUD/USD rate dip under 0.7000, though as noted before, we see good 2-way interest at these levels and we are back above the figure, if only temporarily so. NZD/USD is now grappling with the flash crash lows seen at the start of the year, so we no wait to see whether the demand seen here at the start of the year can soak up the fresh selling seen this morning.
USD/CAD is also holding its bid in a return above 1.3500, though the upturn is showing a lack of conviction as yet, with buyers having taken profit and BoC event risk having passed.
Looking ahead, we have the US Q1 GDP release, which is expected to beat median expectations of a 2.2% rise - forecasts suggesting growth closer to 2.5% which is another prop for the USD at the moment. Any miss, however, could see a profit-taking bout bringing the greenback lower, and looking to month-end flows, we expect to see some USD selling after the bumper run-up in US stocks this month.
US durable goods are the immediate focus this afternoon though.