Daily Market Overview - March 27, 2026

This morning brings one of the key macroeconomic events of the week – at 08:00 (Warsaw time) we will learn the retail sales data from the United Kingdom. The market expects a decrease of 0.6% in this indicator compared to the previous month, when an increase of 1.8% was recorded. This data could significantly impact the British pound, especially considering the recent tensions in the markets related to investor sentiment and the condition of the European economy.

In the context of this week, data from the German industry and services showed mixed results, suggesting some instability in the European economy. Nevertheless, a better-than-expected PMI for the German industry indicates some recovery that may support the common currency. Meanwhile, inflation data from the U.S. showed slightly lower price growth dynamics than anticipated, providing the Fed decision-makers with room to maintain the current monetary policy. This, combined with a slight decrease in the number of new unemployment claims, indicates stabilization in the labor market.

For traders, a key takeaway for today is to monitor the British pound's reaction to retail sales data. If the reading is worse than expected, we can anticipate a weakening of the pound, which may impact European markets. Today's events could act as a catalyst for increased volatility in the morning hours, so traders should be particularly vigilant at the start of the European session.

The current sentiment in the markets remains in the extreme fear zone, as reflected in the current Fear & Greed index at 18/100. Although sentiment has improved slightly in recent days, investors continue to exhibit a high level of caution. The stability of this index suggests that markets may be sensitive to any new macroeconomic information, which, in the context of today's data from the UK, increases the risk of sudden movements in the foreign exchange market. It is worth noting that expectations regarding Fed interest rates remain stable, which may support the dollar in the short term, especially if macroeconomic data aligns with expectations.