Monthly Archives: April 2011

GBP Rates Struggle prior to GDP

GBP exchange rates have struggled today falling 1 cent against the Euro as the market eagerly awaits UK GDP data released at 09:30 tomorrow morning. Figures are expected to come in at 0.5% an improvement from the previous quarter of -0.5%. Should figures come in any worse than 0.5% I would expect pressure for Sterling and the reverse should we see growth figures better than expected.

GBP Rates Improve on Retail Sales

Sterling has had a good start to the mornings session following positive Retail Sales figures released at 09:30. The Office for National Statistics said retails sales volumes including automotive fuel rose 0.2% last month beating forecasts for a 0.5% fall, after February’s 0.9% decline. With figures being much better than expected we have seen the pound gain 0.3% this morning.

For those with an interest in Euro/dollar rates are currently at anear 18 month high, possibly a good time to trade should you need to buy dollars.

Euro Rates Slip On Finnish Election

GBP Euro exchange rates have moved a little against the Euro at present this morning following the Finnish election results yesterday.  The result saw the “True Finns” party achieve a significant minority and they are staunchly opposed to Finnish taxpayers money being used to bail out struggling member states like Greece, Ireland, and Portugal.  Whilst not earth shattering news it has dented confidence in the Euro slightly on what is an otherwise quiet day for UK and European data as the True Finns they are confident they will be able to change the terms of the current Portuguese bailout.

Sterling Edges Up Slightly against the Euro

GBP exchange rates have edged slightly up against the Euro today gaining 0.2%.  The pound started brightly this morning before falling back this afternoon with most of the early morning gains caused by Moody’s the credit rating agency downgrading Ireland’s status to just one from Junk. However the pounds gains were limited as expectation for the European Central Bank to raise interest rates ahead of the UK still keeps pressure on the pound. This is a trend I believe will continue and until we see rumours gather for a UK rate hike, I firmly believe the pound will continue to struggle.

Pound Euro Forecast

Exchange rates for the Pound improved noticeably from yesterday afternoon after the Nationwide consumer confidence survey showed a significant improvement from last months record low.  The Pound has clawed back nearly half a cent against the Euro and a similar amount against the Dollar.

However short term future movement is likely to be determined by the Bank of England Minutes next Wednesday and the UK GDP figures on the 27th as most market focus seems to be on interest rate forecasts.  Current exchange rates have been dominated by who will raise interest rates and when, with the Euro reaching a 13 month and 18 month high against the pound and Dollar respectively in the last few days following the decision to increase interest rates by the ECB.  They are anticipated to raise twice more this year, driving the Euros strength, despite sovereign debt concerns, whilst the US and now the UK expected to leave rates on hold for many months.  If the UK figures and Minutes are a little more favourable then you may see sterling claw back some ground against the Euro as interest rate rises are discussed again.  In my view whilst the Euro is currently very strong, I don’t see this strength being maintained in the longer term against the Pound as growth and debt concerns will come to dominate the PIIGS once again. If you are selling Euros I see this as a very good window because the US is also likely to outstrip the Euro zone when economic growth takes market focus

GBP Rates Steady

Sterling exchange rates have remained flat against the Euro following yesterday’s better than expected inflation figures. The pound has found a little support as unemployment figures remained the same for the month of March, however I feel GBP rates will suffer in the short term as it looks increasingly unlikely that the Bank of England will raise interest rates in May.

EUR USD Exchange Rates Break 1.45

Euro exchange rates against the USD have broken 1.45 establishing a new high and providing a very good opportunity to sell Euros particularly against the greenback and the Pound.

GBP EUR Rates Tumble On Inflation

GBP EUR exchange rates tumbled this morning as UK inflation figures were lower than expected and lessening the probability of an early rate hike by the Bank of England.  The Pound has lost against most majors as a result but presented great opportunities for selling currencies against a sterling purchase.

Sterling Exchange Rates To Change On Inflation Tomorrow

Sterling exchange rates are likely to alter significantly tomorrow morning at 9.30 dependant on how high inflation is running in the UK- if inflation is rampant then some of the Doves may be forced to grow talons and be pressed closer to a rate hike over the summer- a move that could be positive for the Pound.  The pound did fight back a little from the early morning lows but made only slight headway against the Euro, but did a lot better against the greenback.

Half an hour later, German economic sentiment figures are released and could dictate the Euros performance for the day until US trade balance figures are released in the afternoon.

GBP Rates Fall Against the Euro

Sterling exchange rates followed yesterday’s gains with a disappointing day today losing ground against the Euro by nearly 1 cent even after UK PPI data came out better than expected, a result which would normally give the pound a boost. Sterling’s losses appear to be caused by investors backing Europe to raise interest rates at a faster pace than the UK, I also believe the Portuguese bailout leaving the UK potentially out of pocket to the tune of €3bn will have detrimental affects on the short term value of sterling.

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Euro exchange rates on the way up

Euro exchange rates are once again on the way up against the Pound and significantly versus the Dollar which has weakened substantially against both overnight.  Yesterdays rate hike has helped the cause of anyone selling euros and any news which confirms expectations of two more interest rate hikes this year for the single currency will likely provide further support in the short term.

UK Producer Price Index released in the next 15 minutes could cause some further volatility on GBP EUR exchange rates.

GBP/EUR Holds Steady

GBP/EUR exchange rates have remained relatively steady throughout the day with the pound slightly gaining against the Euro to the tune of 0.3%. As expected the Bank of England kept its base rate on hold at 0.5% and the European Central Bank followed 45 minutes later by raising rates, as many expected, by 0.25% to 1.25%. Following the release we saw an initial surge in the Euros favour however Jean Claude Trichet’s subsequent comments have paired back the Euros gains.

The next data set of note will be tomorrow’s UK Producer Price Index at 09:30, this is a measurement of price changes of goods produced by UK manufacturers and a positive reading is generally good for the pound.

Euro Rate Drops After Portugal And Interest Rate Decision

The Euro has lost a little ground against the Dollar and the Pound from yesterday following portugal leeting us in on the worst kept secret and finally requesting the need for financial assistance from the EU.

Trichet didnt dissapoint markets and announced a 0.25 point interest rate rise for the Eurozone but didnt give strong commitments to a series of rate rises which some were looking for to ensure further gains for the Euro.

Sterling Exchange Rates Continue Losses

Following yesterday’s positive gains we have seen the pound lose ground against the Euro further this afternoon. I do feel, however, that GBP/EUR rates hinge on tomorrows key interest rate decisions from the UK and Europe. Personally I believe the UK will keep rates on hold and this will have little impact, however of interest will be that of the ECB. Many analysts expect Europe to raise rates by 0.25% and I firmly believe this has been priced into the market (hence Euros recent strong gains) and should rates be raised, this too will have little impact other than minor Euro gains. However if we see the ECB keep rates on hold then I feel the Euro may have been overpriced and will lose ground following the announcement.

GBP Exchange Rate Down

Sterling exchange rates have taken a big hit this morning against both the Dollar and the Euro after UK PMI Manufacturing data came out a lot lower than expected.  The disappointing figures have eroded much of the Pound’s gains from yesterday and early morning trading.

Euro Rate Dependant On GDP Today

Current Euro exchange rates will be dependant on GDP figures released today expected to come in at 0.3%.  However if these figures are revised down it may discourage the ECB from raising interest rates in the short term which may mean Thursday’s decision to hike becomes a lot less certain.

As posted yesterday, EUR USD rates did break the year high after the Fed Minutes suggested interest rates in the US will remain low for some time, allowing GBP USD rates to climb, and with rates in Europe anticipated to rise, making the Euro a lot more attractive than the greenback.

In the UK Industrial and Manufacturing Production figures will be in the spotlight following yesterdays strong showing for the services sector- expect sterling exchange rate volatility today.

Euro Dollar Rate Close To Year High

The Euro remains close to breaking the year high recently seen despite poor Euro zone retail sales figures today- The FOMC Minutes release in the next two hours could prove very interesting in terms of future monetary policy for the Dollar and determine whether the Euro will break new ground in the short term…If you are selling Euros or buying Dollars keep a close eye on the next 3 days!

The Pound is up close to 1% against the Euro at market close, although Manufacturing & Production PMI tomorrow and Euro zone GDP figures are the ones to watch to see if this trend will continue prior to Thursdays Big Rate Watch.

Sterling Exchange Rates Rally

GBP exchange rates have rallied today in a trend very much against the the recent trading conditions the market has been experiencing. Much of the movement can be attributed to the much better than expected PMI (Purchasing Managers Index) figures released at 09:30 this morning. PMI data came in at the best in over a year and indicated towards solid first quarter GDP growth giving impetus to an earlier interest rate hike in the UK than many had expected.

This led to the pound gaining over 1 cent against the Euro and creating some potentially good buying levels with the key UK and European Interest Rate meetings on Thursday at 12 and 12:45 respectively.

Sterling Euro Forecast Predicts Pound To Remain Weak

Sterling exchange rates are likely to remain very weak versus the Euro if the Eurozone does raise interest rates this week.  The risk for anyone buying Euros will be if the anticipated interest rate hike is bigger than the expectation of a 0.25 point increase.
Comments from Jean Claude Trichet early last month about the need for a modest increase, whilst not part of a series of hikes, really boosted the Euro against the Pound and the Dollar, and given that both the latter currencies are unlikely to be able to raise rates in the near future due to sluggish growth forecasts the Euro is likely to be riding high in the near term.

Key dates are the US FOMC Minutes this evening, and the Bank of England and ECB rate decisions due lunchtime on Thursday.  Be ready to move quickly should the results deviate from expectations and exchange rates change quickly as a result.