The US dollar rose against most of the major currencies in the last week of March.  The stronger than expected January GDP (0.3%) helped lift the Canadian dollar (~0.6%), which was the notable exception.  The Australian dollar’s rise ahead of the weekend and the end of Q4 allowed it to secure a small gain for the week (~0.2%).

The risk that the UK leaves the EU without a deal seemed to many to have increased after a majority of the House of Commons failed to back any alternative, including the Withdrawal Bill for the third (and possibly not the last) time.   This saw sterling briefly trade below $1.30.  We still think a longer extension the leads to a softer and later UK exit will eventually be negotiated and that this will be seen as sterling positive.   The Reserve Bank of New Zealand confirmed what many market participants had suspected, namely that the next move in rates is probably a cut.  This sent the New Zealand dollar lower, and after sterling’s 1.3% decline, its 1.1% decline was the second largest among the major currencies.  Around $0.6800, it is in the middle of the two-cent range that that largely confined it in Q1.