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The pound rebounded as data showed house prices continued to rise. According to Nationwide, the average UK house price jumped to £267,600 in April as demand continued to rise. Prices have increased by £2,000 on a monthly basis or 12.1% on an annual basis. However, the increase was slower than most analysts expected. Housing demand increased while inventories were subdued. Therefore, one wonders if this demand will continue as the Bank of England raises interest rates. In a note, an analyst from Capital Economics said house prices would fall about 3% in 2021 and 1.8% in 2024.

The euro rose against the US dollar even after data showed that many European economies were slowing. In France, data revealed that the economy stagnated in the first quarter while inflation jumped 5.4% in April. In Italy and Spain, their economy contracted while in Germany the economy only grew by 0.2%. Statistical agencies attributed the performance to soaring prices, which helped slow consumer and business demand. Meanwhile, according to Eurostat, preliminary data showed that inflation fell from 7.4% to 7.5% while core CPI fell from 2.9% to 3.5%.

European stocks were deep in the green as the earnings season continued. The Stoxx 50, DAX and CAC 40 indices rose more than 1% while the FTSE 100 index rose more than 0.40%. In the UK, AstraZeneca said sales jumped 60% in the first quarter as demand for its Covid-19 vaccine and rare disease drugs increased. Its sales reached $11.4 billion while revenue from its oncology business reached $3.6 billion. Reckit Benckiser, the consumer products company, said its revenue hit £3.4bn by raising prices by more than 5%. NatWest, formerly known as Royal Bank of Scotland, said its revenue rose 17% to £3bn due to growth in mortgage lending and rising interest rates.

GBP/USD

GBPUSD rose as investors rushed to buy the dip. It hit a high of 1.2560, which was the highest point since Wednesday. It moved above the middle line of the Bollinger Bands. At the same time, the Relative Strength Index (RSI) moved above the oversold level of 30. The Stochastic Oscillator moved to the overbought level. The pair will likely continue higher as the bulls target the upper part of the Bollinger Bands.

EUR/USD

The EURUSD pair also rose as US dollar strength faded. It moved to a high of 1.0575, which was above this week’s low of 1.0465. It moved above the middle line of the Bollinger Bands while the Relative Strength Index moved above the oversold level. The pair is also approaching the overbought level as the Average Directional Index (ADX) has started to decline. Therefore, it will likely continue to fall since it is the last trading day of the month.

EURUSD

XAU/USD

The XAUUSD pair rose sharply after China announced a new stimulus package. The pair reached a high of 1,916, which was the highest level since April 26. It also moved above the important resistance level at 1911 and is located along the upper side of the Bollinger Bands. The Stochastic Oscillator moved above the overbought level while the Relative Strength Index (RSI) moved above 50. The pair will likely continue to rise.

XAUUSD