GBP/USD: Bank of England

You must not only learn to live with tension, you must seek it out. You must learn to thrive on stress. – J. Paul Getty

MARKET NEWS

US backs plan to suspend Covid vaccine patents during pandemic - FT

“This is a global health crisis, and the extraordinary circumstances of the Covid-19 pandemic call for extraordinary measures,” said Tai in a statement. Shares of the major coronavirus vaccine companies were hit by the decision on Wednesday. Moderna, BioNTech and Novavax’s shares fell by between 5 and 7 percent

Wall St regains ground as fears of rising interest rates recede - FT

Wall Street stocks rebounded on Wednesday from the previous session as the prospect of rate rises receded after weaker-than-expected jobs data and a clarification from the US Treasury secretary on remarks that had helped trigger a sell-off.

European equity close: Big bounce across the board – Forex Live

Yesterday was the worst day of the year in the DAX (-2.5%) but it recouped most of the decline today.

Crude oil futures settle at $65.63 – Forex Live

The crude oil inventory data showed a larger than expected drop in inventories of 7.99 million versus -2.0 million estimate. Gasoline inventories were up 0.737 million versus -0.731 million estimate. 

FOREX

EUR/USD struggles to hold above 1.2000 as USD preserves its strength – FX Street

Ahead of Friday's critical Nonfarm Payrolls (NFP) report, the fluctuations in major currency pair remain relatively limited. On Thursday, Retail Sales data from the euro area and the US Department of Labor's weekly Initial Jobless Claims report will be looked upon for fresh impetus.

USD/CAD tumbles to the 1.2250 area, fresh three-year low – FX Street

The USD/CAD resumed the decline and dropped below 1.2265, hitting at 1.2251, the lowest intraday level since January 2018.

AUD/USD Tracks 50-Day SMA Ahead of RBA Statement on Monetary Policy – Daily FX

AUD/USD continues to bounce along the 50-Day SMA (0.7707) following the failed attempt to test the March high (0.7849), and the RBA’s Statement on Monetary Policy may do little to influence the exchange rate as the central bank retains the current course for monetary policy.

MORE HEADLINES

•    Fed's Clarida: I don't think it's time to talk about tapering – FX Street
•    Lumber prices top $1,600 for the first time ever as the ongoing homebuilding craze drains supply
•    Jessica Alba’s Honest Company surges in public debut – Yahoo Finance
•    GM expects to offer personal self-driving vehicles to consumers this decade - CNBC
•    CME Group closing most of its Chicago trading pits
•    Republicans ramp up threats against Big Tech after Trump Facebook ban upheld - CNBC

ANALYSIS

GBPEUR: What to Expect from the Bank of England – Pound Sterling Forecast

The bank will keep its rate unchanged at 0.10%, but traders are more interested in how, and when, the bank will reduce its bond buying QE measures that were ramped up in 2020.

Markets have priced in 50bp of rate hikes by the end of 2024 after the BoE’s February forecasts and it is likely that the BoE will signal the same timeframe. The bank is keen to keep markets in complacent mode, which is another coordinated central bank approach to curtail tapering fears and inflation fears.

Major forecasts: Rise and shine - Nordea

•    The macro environment continues to improve, and inflation pressures are mounting, especially in the US.
•    Central banks have mostly dismissed the idea of policy changes being in store any time soon, but those views may change later this year.
•    Despite the recent pause in rising US bonds yields, there is much more upside left
•    The ECB’s accelerated purchase pace has not prevented bonds yields from striving higher
•    EUR/USD has seen a temporary rebound, but will resume falling before long

CHART

EUR/JPY – Daily Candlesticks

  
Source: GKFX Prime Metatrader 4 

EUR/JPY is falling back towards a potential confluence of support from former resistance and at 130.6 and a 6-month-old rising trendline. - Prepared by Trading Writers*

CALENDAR

*Times in GMT

 
Source: FX Street Economic Calendar

Sources 

https://www.fxstreet.com/economic-calendar
https://www.ft.com/content/eca86f43-7127-4213-948d-3cc8d652805e
https://www.forexlive.com/centralbank/!/feds-clarida-i-dont-think-its-time-to-talk-about-tapering-20210505
https://markets.businessinsider.com/news/stocks/lumber-prices-top-1600-first-time-amid-homebuilding-boom-2021-5-1030392438
https://ca.finance.yahoo.com/video/jessica-alba-honest-company-surges-181209090.html
https://www.cnbc.com/2021/05/05/gm-expects-to-offer-self-driving-vehicles-to-consumers-this-decade.html
https://www.ft.com/content/0c582a68-aeec-41b8-a6dd-b9182c811b14
https://ca.finance.yahoo.com/video/cme-group-closing-most-chicago-164339237.html
https://www.forexlive.com/news/!/european-equity-close-big-bounce-back-across-the-board-20210505
https://www.cnbc.com/2021/05/05/republicans-ramp-up-threats-to-big-tech-after-trump-facebook-ban-upheld.html
https://www.poundsterlingforecast.com/2021/05/gbpeur-what-to-expect-from-the-bank-of-england/