Pound this week May 21, 2012 at 7:38 pm
As many regular readers will know currency markets move for a number of reasons including political events, natural disasters, acts of terror and economic data releases. The first few we have to be very reactive for but, generally, economic data has set dates for their release and the market normally has a expectation of what to expect. These forecasts are normally priced into the market before the actual figures are announced so if they come out as expected there is often very little change to the price of the currency. However, if the real figures are significantly different the market reacts to this information creating a spike (or dip) in the market. Data releases could be about a wide range of things from the amount of new homes being built to unemployment or business confidence and each has a different effect on the currency market, there are around 30 of these reports each month for each country.
We tend to categorise these reports on a scale of 1 to 3; 3 being the most powerful and 1 being the least. Many of the most significant pieces of date are released in the first week of the month but there are certainly a few large announcements due this week that everyone with a currency exchange to make should be aware of:
Tuesday
- UK Retail figures – Grade 3 – expected improvement
- UK Consumer Price Index – Grade 3 – Expected improvement
- UK Public Sector Net Borrowing – Grade 2 – expected fall
Wednesday
- UK Bank of England minutes – information on Quantitative Easing
Thursday
- UK GDP figures – Grade 3 – expected improvement
With this in mind I personally would expect GBPEUR to continue to be very volatile, especially with the Eurozone emergency meeting at the end of the week.
If you have been waiting for the elusive 1.25 to return I would imagine you are walking on a tight rope. To get up to date information on your situation from a currency expect feel free to contact us using the form on the page, calling directly on 01494 787478 or emailing me at hse@currencies.co.uk
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