by Daniel Wright on Feb.08, 2012, under AUD, CAD, CHF, Economic data, Euro, NZD, Predictions, Sterling strength, Sterling weakness, USD
Key market mover this week: BOE
Interest rate decision, further QE. On-going Greek debt agreement. |
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Important Data– If you are considering a trade soon, it’s worth being aware of:
Tomorrow 09:30am – A host of Manufacturing and Industrial Production
data along with Trade balance figures for the U.K This may throw anything up,
production figures have not been too bad of late however as per usual with
the U.K as soon as things seem on the up we tend to get figures that come out
that knock us straight back down again, so be very wary of this one.
Tomorrow 12:00 – Bank of England Interest Rate Decision No change in rates is
expected however there is continuing speculation regarding further
Quantitative Easing. Regular traders will be aware that any mention of QE
tends to weaken the Pound so should we see this tomorrow then we may see
Sterling weakness against all major currencies
Tomorrow 12:45pm – European Central Bank Interest Rate decision There is a slight chance of a rate cut in the Eurozone tomorrow however most major analysts expect the
ECB to hold off for the time being. Key will be the press conference
following the speech which may suggest how the ECB are planning to attack the
crisis going forward.
On-going yet imminent: Greek debt agreement Signs are this is now
close to being tied up and signed off, in past months whenever an
agreement/resolution (no matter how little I believe most think it will work)
is put into place, investor’s confidence in the Euro rises and in turn the
Euro tends to strengthen. By the sound of it the agreement may be finally
signed off on the weekend by Greek Parliament however anything may happen in
the meantime.
Below is a further outline of
recent trends and themes for some of our main currency pairs. |
| Market Overview |
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GBPEUR
**Still close to 16 month
high buying euros**
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It would not surprise me to see
the Euro make a minor fight back in the next week or so, I do not expect
major Euro strength however unless there is a rate cut in Europe then QE
for the Pound and some certainty on Greece may well give it a nudge in the
right direction. |
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GBPUSD
**2 month high for buying
Dollars**
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This pairing has been a hard one
to predict of late, with all of the uncertainty for Greece one would expect
the USD to have gained ground however we have seen quite the opposite over
the past week or so. Personally I feel that the mention of no interest rate
hike until late 2014 will hold the Dollar back from major strength however
I still think it will get stronger again against the Pound in the next week
or so. |
| GBPZAR
GBPAUD
GBPNZD
**27 year high for selling
AUD**
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At present these perceived
‘riskier’ currencies are winning the battle and seemingly strengthening
with great ease. The AUD is breaking long term records, the NZD is closing
in on them and the ZAR has recovered back an awful long way. The main issue
is that this has happened during major uncertainty within Europe.
Uncertainty usually weakens such currencies so I would be a little wary
that when we do see potentially positive news for Europe and negative for
the U.K we could see all of these currencies strengthen further and the
Pound to get even lower against them, however anything can happen and
markets aren’t moving how they are supposed to at present! |
| GBP-CHF |
There is continuing speculation
that the SNB (Swiss National Bank) may move to devalue the Franc again soon
as rates are edging closer to the artificially pegged benchmark they set
against the Euro of 1.20. If this happens |
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For the best exchange
rates … Contact me
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Daniel
WrightAssociate DirectorForeign Currency Direct |
djw@currencies.co.uk0800 328 5884 / +44 1494 725353 |
Get in touch today…
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