Category Archives: USD

US Jobs Data strengthens the US Dollar vs Sterling but for how long? (Tom Holian)

The Dollar has strengthened during the end of the week vs Sterling following the very positive jobs data which came out yesterday afternoon.

The US economy has added an extra 151,000 new jobs taking the unemployment level for the US down to just 4.9%.

This is now at its lowest level since 2008 and the average hourly rate has also risen. The good news is that for Dollar sellers the recent weakening which happened earlier in the week has now reversed.

However, the amount of new jobs created was lower than expected so the Dollar is not out of the woods yet.

Indeed, the report means that the US Federal Reserve may not raise interest rates as quickly as previously expected which could lead to Dollar weakness in the months ahead.

With the primaries now in motion I think the Dollar could have a very indifferent few months ahead.

If we look at what happened during the UK general election Sterling fell out of favour in the run up to the vote and I think the uncertainty over who will lead the US in the future will have a negative effect on the Dollar vs both the Euro and the Pound.

On Wednesday Fed Chairlady Janet Yellen is due to take centre stage and if she signals a slowdown in the speed of raising rates I think this could also see GBPUSD rates move in an upwards direction.

My prediction for next week is for Sterling to gain vs the US Dollar.

If you have a currency transfer to make and want to save money on exchange rates compared to using your own bank then contact me directly for a free quote. Tom Holian teh@currencies.co.uk

 

 

Bank of England Decision causes big losses for Sterling Exchange Rates (Tom Holian)

Sterling has really suffered this week and the negative movements were highlighted yesterday with the Bank of England’s interest rate decision. The 9 members of the MPC have all chosen to keep rates on hold which is a change from the 8-1 vote previously.

Ian McCafferty has changed his mind which to me is not that much of a surprise but this has certainly has a negative impact on Sterling vs Euro.

The UK Quarterly Inflation Report was also published yesterday which caused losses for Sterling compared to both Euro and US Dollar.

The Bank of England has changed both its growth and inflation forecasts and with inflation not expected to hit 2% until 2018 this means we might not see interest rates rise until then either.

The lack of an interest rate rise and the looming fears of a Brexit has caused real problems for Sterling exchange rates and whilst the uncertainty of the EU talks are ongoing I think this will weigh heavily on the Pound.

UK Average Earnings were downgraded from 3.75% to 3% for 2016 and although higher than current inflation levels this is concerning for the UK economy as any downgrade is never positive.

We end the week with US Non-Farm Payroll data this afternoon as well as US unemployment data and if you’re considering a transfer involving Sterling and US Dollars then it is worth keeping your eye out for this data release.

If you have a currency transfer to make and want to save money on exchange rates compared to using your own bank then contact me directly for a free quote. Tom Holian teh@currencies.co.uk

Alternatively call me directly on 01494-725353 and ask for Tom Holian when calling.

 

 

Sterling’s Struggles Continue (Matthew Vassallo)

Sterling’s struggles have continued this week and despite a slight recovery against the USD, the general trend has certainly been negative. The downward spiral coincided with the start of 2016 and the Pound has failed to replicate the good feeling of last year and this has been reflected in the current exchange rates.

GBP/EUR rates have dropped below 1.30 today and as I’ve discussed in previous posts, this is a key resistance level for the Pound. If we see another aggressive move for the EUR the Pound may struggle to break back through it and whilst my underlying feeling has been that the Pound would start to find some support, the current trend is concerning for those clients holding GBP.

It is slightly better news for those clients looking to purchase USD, with the Pound fighting back over the past 48 hours. The pair is floating around 1.45 having spent most of last month closer to 1.40. Poor employment figures in the US have helped to stem the flow but based on the current economic climate in the UK, I am not anticipating this positive spike to continue. As we move through the year we may see Sterling improve, as the US elections are likely to cause some uncertainty and the hope for those clients holding GBP is that 1.40 will provide some protection if the rates do start to drop again.

Much of the focus this week has been on the UK and with key data releases yesterday, investors were dubbing it ‘Super Thursday’. Unfortunately it was anything but and the Pound suffered as a result. The Bank of England’s (BoE) UK Inflation Report made for grim reading and with BoE governor Mark Carney cutting growth forecasts in the UK, I’m not expecting a major improvement for Sterling in the short-term.

If you have an upcoming currency requirement and would like to be kept up to date with all the latest market movements, or simply wish to compare our award winning exchange rates with your current provider, then please feel free to contact me on 0044 1494 725 353 and ask one of the reception team for Matt. Alternatively, I can be emailed directly on mtv@currencies.co.uk

What impact will the BOE Interest Rate Decision have on Sterling? (Daniel Johnson)

Thursday will see the Bank of England (BOE) Interest Rate decision. It is highly unlikely there will be any change. At has remained at 0.5% for years, and Mark Carney has indicated there will be no rat hike until 2017. I doubt anything until 2018 personally.

Although the rate decision itself may be a bit of a non event what is of interest is how the Monetary Policy Committee (MPC) vote. The MPC consists of nine members who vote on whether there should be a change to interest rates. The vote has been coming in at 8-1 for months with Ian McCafferty the sole member voting in favour of a hike. If there is any change in the votes expect market volatility. The current figures coming out for the UK economy are well below par, when coupled with general global economic uncertainty there is an outside chance a member of the MPC could change there vote. If McCafferty changes his stance or another member votes in favor of a rate drop expect Sterling to lose value.

If you would like an in depth forecast to assist with your personal trade requirements I would be happy to assist. I specialise in GBP/EUR, GBP/USD GBP/CHF,  GBP/AUD and GBP/NZD. If you have a currency requirement in such volatile times it is vital to time your trade. I am constantly watching market movement and data releases to try and predict where the market is headed. I am happy to  help you maximise your trade and I can also guarantee to beat any competitors rate.I have consistent large trades going through over the next few days , potentially I can tag new clients on to these trades and gain a very competitive rate.  If you have a currency requirement I would  recommend getting in touch by mailing me directly at dcj@currencies.co.uk . Thank you for reading my blog it is greatly appreciated I look forward to hearing from you.

Sterling records significant losses on GBP/EUR, but less so on GBP/USD (Joshua Privett)

Sterling weakened marginally on the markets yesterday, causing small losses across the board, but the most serious ones were recorded against the Euro. This was why GBP/EUR almost dipped below 1.31, but since recovered slightly as the afternoon progressed.

The reason for the more visible losses for Sterling against the Euro was that the Euro itself had a very strong day on the currency markets, and could be described as the clear winner by quite some distance.

This was due to results showing unemployment had now fallen across the entire Eurozone for the third month in a row.

Yesterday highlighted to anyone hoping to make a Euro purchase that there is still significant room for GBP/EUR rates to fall, particularly with levels being as low as 1.28 only a few weeks ago.

Further Eurozone data is expected to be released today and will likely paint the Euro in a similarly positive light.

The European Commission will be presenting their growth forecasts for Eurozone during 2016, which will likely have the full attention of markets tomorrow.

The past few months have seen the Eurozone regulalry post positive growth figures, with their 11 months of emergency financial stimulus finally showing similar results that the UK enjoyed following our own recession.

As such markets are expecting some optimistic forecasts for the Eurozone today which will likely see the Euro make further gains against the Pound throughout the day.

Similarly, these gains should be more extensice than yesterday, due to the added pressure of the announcement of the Bank of England’s interest rate decision.

For the past 4 months consecutively, this has caused the Pound to suffer on the currency markets. The reason being that the chance of an actual interest rate occuring in the UK is almost non-existent.

In fact Mark Carney, the Governor of the Bank of England, has now stated on more than once that due to worryingly and prolonged low inflation leves a hike will not be on the table until at least 2017.

If the vote split for a hike comes in at a complete whitewash of 9-0 against a vote, GBP/EUR rates, and GBP/USD buying rates should be put under further pressure.

I strongly recommend that anyone with Euros or Dollars to buy should contact me on 01494 787 478 and ask our reception for Joshua, and I will respond personally to discuss a strategy for your transfer in order to maximise your foreign currency return.

I have never had an issue beating the rates of exchange offered elsewhere, and these current improvements on GBP/EUR can be fixed for a small deposit if you do not require your currency until later in the month or March. This will avoid your transfer getting more expensive if the drops we are expecting manifest. jjp@currencies.co.uk

Sterling Outlook – GBP/EUR, GBP/USD, GBP/AUD (Daniel Johnson)

Sterling has lost value against the majority of major currency pairings. This is due to the factors listed below:

  • The EU referendum, during times of political uncertainty the currency in question will weaken. With no resolution for some time this will weigh heavily on the Pound.
  • Poor Retail Sales Figures
  • Poor Manufacturing Data
  • Well below Par Inflation – Inflation currently sits at 0.1% and the target is 2%
  • China’s slow down in Growth

GBP/EUR

The Euro has benefited from China’s slow down with many Investors flooding back to the Euro. This is due to carry trading, where an investor would borrow a currency at a low interest rate, eg the Euro and invest in a riskier currency eg AUD,NZD for higher returns. The global uncertainty sparked by the situation in China has caused investors to panic and move back to the Euro. This combined with the poor data has caused GBP/EUR to drop from 1.42 in December to the low 1.30s where we sit now. It is definitely going to be difficult for Sterling to recover. A big swing could occur if the head the ECB implements lager monthly increments in the Quantitative Easing (QE) Program.

QE is essentially pumping money into a struggling economy in order to stimulate growth. The first opportunity for this to occur will be March. For that reason if I was a Euro seller I may consider moving before. The key data release this week will be the BOE interest rate decision on Thursday. If there is a change in the MPC vote we could see swing si in GBP/EUR value. If you would like a more detailed forecast taking in to account your personal currency requirement please do not hesitate to get in touch using the contact details below.

GBP/USD

Due to the Fed introducing a rate hike in December and indicating further rate hikes in 2016 I do not think there is much hope for the Pound against the Greenback for the foreseeable future. I think the general trend will be a drop in Sterling value. There will no doubt be small Spikes in favour of the Pound but it you will have to follow the markets very closely in order to take advantage of these windows of opportunity. Watch out for Non-Farm Payrolls on Friday afternoon which is renowned for creating market volatility.  If you would like an expert opinion on when would be a wise time to move on your trade please do drop me an email.

GBP/AUD

The RBA recently decided against a rate cut despite China’s growth slipping to a twenty-five year low. The Aussie currently stands firm.I do not think a rate hike is out of the question in March however which could bring Sterling back towards the 2.10 level. AUD sellers have to be particularly wise in order take advantage of their trade. Keep in mind resistance levels when you are choosing your target rate.

Timing a trade correctly is vital to maximising your return, with the help of a broker you can expect to be kept up to date with vital data releases and market movement. My clients have been extremely happy with the way their trades have worked out as of late and I would would take pleasure in assisting any new clients with their trade. I will also guarantee to beat any competitors exchange rate. If you have a currency requirement I would  recommend getting in touch by  e-mailing me directly at dcj@currencies.co.uk. Thank you for reading my blog it is greatly appreciated I look forward to hearing from you.

 

The week ahead for Sterling exchange rates – Economic data of interest and contract types that may assist you (Daniel Wright)

So we have another busy week ahead for Sterling exchange rates including an interest rate decision for Australia tonight, Unemployment data for New Zealand tomorrow night, Bank of England interest rate decision and meeting minutes on Thursday lunchtime followed by Non-Farm Payroll data due out on Friday afternoon.

There is indeed plenty for the market to feel off of this week and I would expect some fairly large swings, especially for the Antipodean currencies (Australian and New Zealand Dollar) overnight early in the week. With the possibility of such large movements overnight it is key that you have protection in place should you be looking to carry out a currency exchange in the near future.

All the writers here at Pound Sterling Forecast work for a currency brokerage with a turnover of over half a billion Pounds a year, which means we have access to fantastic rates of exchange. Even if you feel you are getting a good deal elsewhere at the moment I would be extremely surprised if we couldn’t do better for you. You can email me (Daniel Wright) the creator and main editor of this site on djw@currencies.co.uk with a brief description of what you are looking to do and a contact number and I will be happy to contact you personally. You can also call me during U.K office hours on 01494 787 478 (please ensure you ask for Daniel Wright).

We have a number of contract types that can help you during such volatile times including the following:

Forward contract: This is where you can lock into a rate of exchange for anything up to two years in advance with just a small deposit. This is really handy for anyone buying or selling a property overseas that would like to protect some or even all of their funds against currency fluctuations. I see time and time again clients agreeing to purchase a property overseas and putting down a deposit only to find themselves in a tricky situation later down the line when coming to pay for the balance on the property because the rate has dropped so much. For some reason even the most sensible people decide to effectively gamble thousands of Pounds based purely on hope over actually having knowledge that an exchange rate will go their way. djw@currencies.co.uk if you would like more information.

Limit order: If there is a particular rate of exchange you would like to achieve but the market just is not there yet then you can place a limit order into the market. This order is free and can be cancelled or amended at any time you like as long as it has not gone through, but basically means that if at any time 24 hours a day/7 days a week your rate becomes achievable then your currency will be bought out automatically and we will just contact you to let you know the good news. djw@currencies.co.uk if you would like more information.

Stop Loss: This contract type is handy if you are working to a tight budget and cannot afford to go any lower than a particular rate and works in a similar way to the limit order above, yet will trigger should your buying rate hit your chosen lowest possible point. Some clients like to ‘chase the market up’ and raise their stop order on a daily basis when the market is moving in the right direction for them. djw@currencies.co.uk if you would like more information.

I have no doubt this will be a busy week, please do feel free to get in contact with more information on the above or if you have an exchange you with to carry out and you would like to know what rate we can offer you.

GMT Time left Area Currency Event Consensus Previous
09:30 UK GBP Markit Manufacturing PMI (Jan) 51.8 51.9
09:30 UK GBP Consumer Credit (Dec) £1.300B £1.476B
09:30 UK GBP Mortgage Approvals (Dec) 69.60K 70.41K
13:30 US USD Personal Consumption Expenditures – Price Index (YoY) (Dec) 0.4%
13:30 US USD Core Personal Consumption Expenditure – Price Index (MoM) (Dec) 0.1% 0.1%
13:30 US USD Personal Income (MoM) (Dec) 0.2% 0.3%
13:30 US USD Personal Spending (Dec) 0.1% 0.3%
13:30 US USD Personal Consumption Expenditures – Price Index (MoM) (Dec) 0%
13:30 US USD Core Personal Consumption Expenditure – Price Index (YoY) (Dec) 1.3%
14:30 CA CAD RBC Manufacturing PMI (Jan) 47.5
14:45 US USD Markit Manufacturing PMI (Jan) 52.7 52.7
15:00 US USD ISM Manufacturing PMI (Jan) 48.0 48.2
15:00 US USD ISM Prices Paid (Jan) 34.0 33.5
15:00 US USD Construction Spending (MoM) (Dec) 0.6% -0.4%
16:00 EMU EUR ECB President Draghi’s Speech
18:00 US USD Fed’s Stanley Fischer speech
TUESDAY, FEB 02
03:30 AU AUD RBA Interest Rate Decision 2% 2%
03:30 AU AUD RBA Rate Statement
08:15 CH CHF Real Retail Sales (YoY) (Jan) -1.3% -3.1%
08:55 DE EUR Unemployment Change (Jan) -7K -14K
08:55 DE EUR Unemployment Rate s.a. (Jan) 6.3% 6.3%
09:00 IT EUR Unemployment (Nov) 11.3% 11.3%
09:30 UK GBP PMI Construction (Jan) 57.6 57.8
10:00 EMU EUR Unemployment Rate (Dec) 10.5% 10.5%
21:30 US USD API Weekly Crude Oil Stock 11.4M
21:45 NZ NZD Unemployment Rate (Q4) 6.1% 6.0%
21:45 NZ NZD Employment Change (Q4) 0.8% -0.4%
21:45 NZ NZD Participation Rate (Q4) 68.6%
WEDNESDAY, FEB 03
00:00 NZ NZD RBNZ Governor Wheeler Speech
00:30 AU AUD Exports (Dec) 1%
00:30 AU AUD Imports (Dec) -1%
00:30 AU AUD Trade Balance (Dec) -2,500M -2,906M
01:45 CN CNY Caixin China Services PMI (Jan) 50.2
02:30 JP JPY Bank of Japan Governor Kuroda Speech
08:00 EMU EUR Non-monetary policy’s ECB meeting
08:15 ES EUR Markit Services PMI (Jan) 54.5 55.1
09:00 EMU EUR Markit PMI Composite (Jan) 53.5 53.5
09:00 EMU EUR Markit Services PMI (Jan) 53.6 53.6
10:00 EMU EUR European Commission Releases Economic Growth Forecasts
13:15 US USD ADP Employment Change (Jan) 195K 257K
14:45 US USD Markit PMI Composite (Jan) 53.7
14:45 US USD Markit Services PMI (Jan) 53.7
15:00 US USD ISM Non-Manufacturing PMI (Jan) 55.1 55.3
15:30 US USD EIA Crude Oil Stocks change (Jan 29) 8.383M
23:50 JP JPY Foreign bond investment (Jan 29) ¥475.3B
23:50 JP JPY Foreign investment in Japan stocks (Jan 29) ¥-189.2B
THURSDAY, FEB 04
00:30 AU AUD National Australia Bank’s Business Confidence (QoQ) (Q4) 0
06:45 CH CHF SECO Consumer Climate (3m) (Q1) -18
08:00 EMU EUR ECB President Draghi’s Speech
09:00 EMU EUR Economic Bulletin
12:00 UK GBP BoE Interest Rate Decision (Feb 4) 0.5% 0.5%
12:00 UK GBP BoE Asset Purchase Facility (Feb) £375B
12:00 UK GBP Monetary Policy Summary
12:00 UK GBP Bank of England Quarterly Inflation Report
12:00 UK GBP BOE MPC Vote Unchanged 8 8
12:00 UK GBP BOE MPC Vote Cut 0 0
12:00 UK GBP BOE MPC Vote Hike 1 1
12:00 UK GBP Bank of England Minutes
12:45 UK GBP BOE’s Governor Carney speech
13:30 US USD Initial Jobless Claims (Jan 29) 278K
15:00 US USD Factory Orders (MoM) (Dec) -2.6% -0.2%
22:30 AU AUD AiG Performance of Construction Index (Jan) 46.8
FRIDAY, FEB 05
00:30 AU AUD Retail Sales s.a. (MoM) (Dec) 0.5% 0.4%
00:30 AU AUD RBA Monetary Policy Statement
05:00 JP JPY Coincident Index (Dec 111.9
05:00 JP JPY Leading Economic Index (Dec) 103.5
13:30 US USD Nonfarm Payrolls (Jan) 190K 292K
13:30 US USD Average Hourly Earnings (YoY) (Jan) 2.5%
13:30 US USD Unemployment Rate (Jan) 5% 5%
13:30 US USD Labor Force Participation Rate (Jan) 62.6%
13:30 US USD Average Hourly Earnings (MoM) (Jan) 0.3% 0.0%
13:30 US USD Trade Balance (Dec) $-43.0B $-42.4B
13:30 CA CAD Unemployment Rate (Jan) 7.1%
13:30 CA CAD Net Change in Employment (Jan) 22.8K
15:00 CA CAD Ivey Purchasing Managers Index (Jan) 42.5
15:00 CA CAD Ivey Purchasing Managers Index s.a (Jan) 50.3 49.9
18:00 US USD Baker Hughes US Oil Rig Count 498
20:00 US USD Consumer Credit Change (Dec) $16.00B $13.95B

I have no doubt this will be a busy week, please do feel free to get in contact with more information on the above or if you have an exchange you with to carry out and you would like to know what rate we can offer you. You can call me on our trading floor 01494 787 478 or email me directly djw@currencies.co.uk and I look forward to assisting you.

 

How will GBP/EUR, GBP/USD and GBP/AUD fare in February? (Joshua Privett)

Sterling had an incredibly difficult period in January. Rarely is it that currency market movements make the news but the dramatic falls on rates to buy Euros and various Dollars was hard to ignore.

To gain an understanding for how GBP/EUR, GBP/USD, and GBP/AUD will fare next month it would be invaluable to look back to how the UK economy performed during December and January.

The first few weeks of each month normally see the largest movements for exchange rates on the Pound. This is because the first two weeks are when  data for output in various sectors of the economy are tallied and released for the previous month – causing the value of the economy’s currency to change wildly based on how positive or negative the figures released paint the UK to global markets.

This is why the first few weeks of January saw the most serious slides for Sterling’s value, as December was was proven to be a very testing month.

Due to the flooding in the North, West, and later on parts of the South-East, industrial and manufacturing output slowed dramatically.

Even retail sales during the holiday period only grew at a fifth of what was expected.

With the flooding having continued into January, I would not be surprised that the latest set of figures to be released over the coming weeks will be displaying the UK in a fairly unflattering light.

Furthermore, January had seen the added hit to the financial service industry – the engine room of the British economy.

Deteriorating news coming out of China caused the second serious panic on global stock markets since October. With more capital going out of financial markets than going into them, we could see an added dimension to Sterling’s current weakness this month which will create testing times for Euro and Dollar buyers.

I strongly recommend that anyone with foreign currency to buy using Pounds in the coming months should contact me on jjp@currencies.co.uk to discuss a strategy for your transfer in order to maximise your currency return.

I have never had an issue beating the rates of exchange offered elsewhere, and these current buying levels for Euros and Dollars can be fixed to avoid any further currency movements making your future purchase more expensive.

February is a very important month for the pound!

February is a very important month for sterling because we will get the latest news on the UK’s Referendum information and the Bank of England Quarterly Inflation Report. The pound has been sold because of worries over the EU Referendum or ‘Brexit’, at this point we know very little hence sterling being on the backfoot. Sterling should react to the latest news on this event with interest, February could bring with it three key points.

3 Key Points due  on the Brexit in February which will impact GBP

1 – Referendum Date. Unknown when we will get the date but it could be as early as June or as late as 2017. Once we know the date we can begin to plan and asses how the pound will react.

2 – EU Re negotiations. David Cameron is renegotiating the UK’s relationship with the EU to present the public with a clearer choice ahead of the Referendum. Headlines around good news on how this is going should cause the pound to rise, bad headlines could see sterling slide!

3 – EU Summit 18-19th February. This is when we might know the results of any re negotiations for the UK. Once we know this information markets can digest the information and decide the likely outcome and take positions on the outcome.

Markets hate uncertainty and at present we have lots! Next week is the latest news on the UK economy from the Bank of England which is difficult to be viewed in a positive light but could surprise us. It seems every time the Bank of England or Mark Carney speak sterling dips so this is a very important release.

If you are buying or selling sterling in the future next month will give us clearer direction as we learn the latest news on events that will impact sterling exchange rates. Whether you are buying or selling the pound we are here to help! This year is critical for the UK with the EU Referendum having the potential to really upset decades of economic and political cohesion between the UK and the EU. On amounts of £10,000 to multi millions we work with business and private clients to assist with the very best rates of exchange and provide a helpful, friendly and experienced broker service to guide you through the foreign exchange market. For a quick overview of the market and all of your options when considering a large currency purchase please email me Jonathan on jmw@currencies.co.uk.

Economic data due out tomorrow that may impact Sterling exchange rates (Daniel Wright)

Another fairly quiet day on the markets today for those with an interest in buying or selling Sterling, however tomorrow I would expect to see a little more volatility.

The last working day of the month can lead to sharp movements without warning as we see month end flows…. basically companies and funds netting off positions in advance of a new month. Quite often on the last working day of the month Sterling can become quite volatile against all major currencies as we see this happen , so it is important if you have a fairly imminent transfer to make that you keep in close contact with a proactive broker.

Here at Pound Sterling Forecast we do not only give you up to date market information but we can help you with exchanges too. We can get the very top levels of exchange on the markets due to our vast buying power and we pride ourselves on helping our clients with the timing of when they exchange their currency. If you would like me (Daniel Wright) the creator of this site and a Director at Currencies.co.uk to help you with a transaction or merely to give you a quote then feel free to email me personally on djw@currencies.co.uk and I will be more than happy to get straight in touch.

Economic data of note tomorrow is European inflation data, out at 10:00am (expectations are for a jump to 0.4%) which may give the Euro a little boost if matching that figure. I wouldn’t be surprised to see it fall short and to offer an opportunity to purchase Euros at a slightly better rate.

Later in the day we have U.S Growth figures – These are due out at 13:30pm and expectations for this is a level of 0.8%. This release can impact all major currencies as they may alter global attitude to risk.

For those with a Canadian Dollar interest we have growth figures for Canada at exactly the same time so be aware we may see a little volatility shortly after this period.

If you are looking to exchange any currency in the near future then it is well worth getting in touch with me. You can call me during U.K office hours on 01494 787 478 (Please ask for Daniel Wright) or you are welcome to email me with a description of what you need to do on Djw@currencies.co.uk and I will be more than happy to put together a game plan together with you.