Last week saw the release of the minutes from the US Federal Reserve and the European Central Bank monetary policy meetings which took place in March. While Fed members felt that policy should remain unchanged on growing risks of inflation failing to rise, in Europe, ECB officials were unanimous in their view of acting strongly which saw the ECB cut interest rates as well as expand the QE bond purchases. EURUSD saw modest moves over the week and a brief attempt to test the high of 1.145 but various ECB officials came out strongly dovish sending the single currency weaker.
It was however a week to remember for the Japanese yen as USDJPY fell to a 17-month low sparking speculation that Japanese officials would intervene to stem the yen's rapid appreciation. However, despite stern warnings from various government officials in Japan, there was nothing concrete in terms of action leaving the yen vulnerable as USDJPY fell to lows of 107.66 before managing to recover by Friday's session.
In the UK, economic data over the week included the PMI’s from the construction and services sector, both of which managed to rise higher from February’s print in the month of March. The British Pound was weaker however with Brexit still being the main reason for the pound’s weakness. On Friday, industrial and manufacturing production numbers came out weaker than expected and the ongoing talks of Tata Steel selling its UK arm remains a big issue as it puts at risk nearly 15,000 jobs in the UK. EURGBP was seen trading comfortably above the 0.80 handle this week after a brief pullback from a 22-month high at 0.81.
From Canada, economic data was mixed for the most part. Initial gains from previous economic reports were erased as Canada's exports fell sharply in February leading to a wider than expected trade deficit. Ivey PMI was also weaker falling from 53.4 in February to 50.1 in March. On Friday, Canada's employment data saw a surprise dip in the unemployment rate, falling from 7.30% in February to 7.10% in March while the economy added 40.6k jobs in the month, more than the forecasted 10.4k.