What could impact the currency markets this week?

Good afternoon and I hope you all had an enjoyable bank holiday break. Following last weeks late surge for the pound I will explore what could impact the pound and other select major currencies (USD, AUD, NZD) in the coming week.

In the absence of any major key Brexit news, something that will dominate the pounds movements over the short to medium term, Theresa May is set to meet the chairman of an influential committee of backbench Tory MPs, Sir Graham Brady, amid calls for her to set a firm resignation date. This comes following a very poor show for the Conservative Part during last weeks local elections. This meeting, which No 10 insists is routine, will heap more pressure on the PM, with local Tory associations confirming they will hold a vote of confidence in her leadership on 15 June.

Brexit and political uncertainty aside below I have outlined the key data this week that could impact the currency markets.

Economic data releases that could affect exchange rates

Tuesday 7th May – today has been very quiet from the pound point of view but this afternoon there will be a speech from the Bank of England member Andrew Haldane. There will also be a series of speeches in the US from key Fed members including Randal Quarles. Nothing expected from these but one to keep an eye on.

Wednesday 8th May – those looking at the NZD may have an early start as overnight will see the release of the latest Reserve Bank of New Zealand (RBNZ) and accompanying monetary statement. Rates expected to remain on hold but the statement will be closely scrutinised for clues as to the future direction of interest rates. For those looking at the Euro there will be a speech from ECB President Mario Draghi at 12:30

Thursday 9th May – this morning look out for the NIESR GDP estimate, this is often very close to the actual release and can cause movements for the pound. This afternoon will see jobless data in the US at 13:30 followed by a speech from Fed Chair Jerome Powell.

Friday 10th May – this morning will see the release of the Reserve Bank of Australia (RBA) monetary policy statement. Look out for clues as to he future direction for interest rates. Sentiment from the RBA has been changing quite frequently and again the statement could influence the short term movement for the Australian Dollar.

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