Good morning. In today’s post, I’ll take a look at what data releases are due this week that could affect Sterling exchange rates. Some key events include UK growth figures on Friday, and speeches by various central bank members. A very important thing to look out for is the European Central Bank meeting at the end of the week. The UK will present their Brexit white paper. If the markets see this is as a sign of progress, it could Read More
As forecast by my colleague Alastair rates have pushed back through the 1.14 level today following the latest Bank of England interest rate meeting. As expected, the central bank held its key base rate on hold at 0.5% but it was the how the nine members decided to vote that was to drive the market. Market expectation was for 7-2 split in favour of keeping rates on hold however the vote was 6-3. Andrew Haldane, the Bank’s chief economist, joined two other Monetary Policy Committee members in voting to raise rates to 0.75%
The bold move by Andrew Haldane has now increased the chance of a rate hike at their next meeting in August although Read More
Good morning. GBPEUR rates have slipped into the €1.13’s this week, giving up the gains we saw last week. GBPEUR rose into the €1.14’s after the European Central Bank (ECB) cut growth forecasts. this had weakened the Euro and pulled GBPEUR lower. The gains were short lived however, as UK politics move back in to focus.
There are 2 key events in the next few days that I think could affect the Pound/Euro rate. Firstly, today we have another vote in the House of Commons. Last week the government won a vote against amendments the House of Lords were proposing. The Lords have now re-worded their amendment. What they want is Parliament to have a say in negotiations in the event that no deal is agreed. The government disagree. It will be a close vote. If the government lose today, then effectively it means that Parliament will have the power to intervene in negotiations that, in my view, would weaken May’s hand in negotiations. if they lose the vote today, I would expect the Pound to fall in value. If they win, then it should remove some political uncertainty and shore up the Pound.
After today’s debate and vote in the commons, focus will turn to tomorrow’s Bank of England meeting. We do not expect any change to interest rates. What will be important for GBPEUR however is Read More
As we start another busy trading week I will outline below would data could impact sterling exchange rates this week. It is a busy week with much of the notable data scheduled towards the latter part of the working week. I have outlined this below and how it could impact the pound against a number of key major currencies.
Monday June 18 – today has been a relatively quiet day with little data of note. We have a number of speeches from key Fed members and also a speech from European Central Bank (ECB) President Mario Draghi. Nothing of note is Read More
Good morning. Pound Euro rates rose yesterday after the European Central Bank (ECB) meeting. As expected, they announced an end to their Quantitative Easing (QE) Programme at the end of the year. My colleague Michael predicted this, however the effect on exchange rates proved a little harder to foresee! Michael, and the markets in general, thought that an end to QE would be positive for the Euro. This should have strengthened the Euro and pulled Pound Euro rates lower. However, in the Press Conference the ECB president Mario Draghi made some other announcements. This caused the rate to move in the other direction.
Draghi said that interest rates will remain unchanged for at least another 12 months. This did not help the Euro. He also said that Read More