6th September 2010
Good morning. Sterling fell against the Euro last week, after UK economic data came in weaker than expected. In contrast, better EU figures have strengthened the single currency, and the net effect is rates dropping below €1.20. Today, we’ll look at GBP/EUR, GBP/USD and a look at what data is being released this week that may affect rates. First, the usual snapshot of rates as at 09:00am:
- GBP/EUR 1.1980
- GBP/USD 1.5450
- GBP/AUD 1.6844
- GBP/NZD 2.1344
- GBP/CAD 1.6028
- GBP/CHF 1.5711
- GBP/ZAR 11.074
- GBP/HKD 12.002
- GBP/JPY 129.95
- GBP/HUF 338.71
- EUR/USD 1.2894
Pound falls against Euro
Sterling ended last week on a negative footing against the euro after weak UK economic data contrasted with relatively upbeat euro zone figures and put the pound under pressure. Much weaker-than-forecast UK services sector data raised concerns Britain’s economy could falter later in the year.
The poor UK figures highlight concerns that the UK may be heading back to recession. The better EU figures have compounded this, and that’s the reason that rates have dipped back below the €1.20 levels. See below for economic data that could affect Pound to Euro rates this week.
Sterling vs US Dollar
The pound rallied slightly and ended last week slightly up against the US Dollar. There were better than expected Jobs data from the US last week. Usually you would expect good data to strengthen a currency, however in the current climate good news from the states increases risk appetite, and investors that have flocked to the safe haven status of the USD return, and this sometimes weakens USD. That’s the reason that despite the poor UK figures, the pound hasn’t fallen as much as it has against the Euro.
This Weeks Data
As usual, below we list the main fundamental data releases for the week. The releases will affect you in different ways, depending which currency you need to buy or sell. So, contact us today for a free
Consultation on how these releases may impact your currency purchase. Fully informed of what may move exchange rates, you can make a decision on when to fix your rate, and which contract may be best for you to reduce exposure to adverse rate movements.
A free consultation is the first step to taking control of your currency purchase, and not allowing the markets to control you!
It’s Labour day in the USA, so US and Canadian markets are closed today. We have some confidence data from the EU, and Retail Sales from the UK later today.
An interest rate decision from Australia today, although we expect rates to be left on hold at 4.5%. Factory orders will be closely watched from Germany, the largest economy in the EU. For the UK Shop Price index data measures price changes in the popular retail outlets in the UK. From the USA, consumer confidence is the only release of note.
A very busy day for the UK. We see Industrial and Manufacturing production data in addition to a GDP estimate. Today is the most likely to cause volatility for Sterling exchange rates. For the Eurozone, Trade balance figures from Germany is the main release. Those that need to buy or sell Canadian Dollars should take note that an interest rate decision is released today. We expect a hike in rates to 1%. If this happens, expect GBP/CAD to fall.
German Consumer prices start the day for the Eurozone, and at 9am the ECB has a monthly report, which contains a detailed analysis of the prevailing economic situation and the risks to price stability. For the UK today, Trade balance figures and the BoE Interest rate decision is the main news. We expect no change in rates. USD buyers/sellers should be aware Jobless data from the states could cause volatility.
A quieter day, with only producer prices from the UK. This is a monthly measurement of the rate of inflation experienced by the UK manufactures when buying goods and services. It can often affect the pound, so we may see some exchange rate volatility today.
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