It will be a key factor in the Federal Reserve's next interest rate decision and could cause volatility in markets. "There is a semblance of calm about today's trading session in the absence of any major data," said Simon Harvey, head of FX analysis at Monex Europe.
"Price action instead is likely to be determined by
expectations for tomorrow's payrolls print."
The U.S. jobs market has remained resolutely strong, keeping
the pressure on the Fed to raise interest rates to tackle
inflation. Yet analysts expect the U.S. to have added 239,000
jobs in March, a slowdown from February's 311,00 figure.
The pound was also little changed against the euro , with a euro changing hands for 87.51 pence.
Sterling has risen dramatically after plunging to a record
low of $1.033 in September in the wake of then-Prime Minister
Liz Truss's disastrous budget.
A stronger-than-expected economy, aided by falling energy
prices, has helped the pound. As has a recent drop in the dollar
as investors worry about the collapse of Silicon Valley Bank and
Signature Bank and the implications for the U.S. economy.
With British inflation unexpectedly jumping to 10.4% in
February, investors broadly think the Bank of England will raise
interest rates further. They're less sure about the Fed.
Expectations of higher interest rates have helped the pound,
by making sterling-denominated fixed income investments in
Britain look relatively more attractive.
In a thin calendar, data from Halifax showed that British
house prices rose for a third month in a row in March. However,
separate figures showed that house-building in Britain fell at
the sharpest pace since May 2020 last month.
The dollar index, which tracks the currency against six
peers, was last up 0.07% at 101.94. It stood at a three-month
high of 105.88 in early March.
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Pound vs. USD ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
(Reporting by Harry Robertson; Editing by Robert Birsel)
