Pound/Sterling forecast

Pound/Sterling forecast

Good afternoon and I hope you all had a nice weekend. As with typical Monday posts I will explore the key data sets to look out for this week and how this could impact pound/sterling exchange rates. I will focus on GBP/EUR, GBP/USD and GBP/AUD.

Monday 2nd September – To start the working week and a new month we have no data from the US with it being Labor day. This being a US bank holiday. Early this morning we had a host of manufacturing figures released by Markit. UK figures contracted from 48.4 to 47.4 causing the pound to fall in early morning trading.

Tuesday 3rd September – Overnight we will see retail sales data from Australia. Following this will be the statement from the Reserve Bank of Australia. Any insight to a future interest rate cut from the Central Bank and we could see the AUD weaken. In the afternoon session look out for Markit manufacturing data from the US at 13:45. We will also see the UK court hearing begin today. This being the legal bid to prevent PM Boris Johnson’s government from suspending parliament. Developments around this could cause significant volatility for the pound.

Wednesday 4th September – Today is heavy with European data. This starts with Markit Services at 09:00. Following this at 10:00 will be retail sales. Month on month figures expected to decline from 1.1% to -0.6%. This afternoon will see a number of speeches from key members of the Federal Reserve. Their insight into the US market will be scrutinised and impact GBP/USD accordingly.

Thursday 5th September – Overnight will see trade balance data from Australia. There will be no UK data but the continuation of the UK court hearing on forcing a no-deal Brexit will be key for short term sterling trends. This afternoon is dominated by US releases. Look out for initial jobless claims at 13:30 followed by market services at 14:45.

Friday 6th September – To finish the working week we have Euro Zone GDP figures at 10:00 along with employment change. This afternoon will see key jobs data from the US with non-farm payroll. This release is notoriously volatile and often vastly different from the expected level. As a result look out for USD volatility post the decision at 13:30.

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