Today we have the Bank of England (BoE) and European Central Bank (ECB) interest rate decisions. The BoE decision is at 12.00, and the ECB is 12.45.
Possible outcomes: The BoE may announce further Quantitative Easing (QE) for the UK, although this is not wholly expected. Nevertheless the pound has lost recent gains against the Euro, with trading levels creeping back into the 1.19’s.. More QE will likely cause a move towards the 1.17-1.18 range. The ECB may cut rates by 0.25% to 0.75%, but this is again not wholly expected. I would expect this to cause a move to 1.22 + on GBPEUR. The general concenus is that there will be no changes, but even if this is the case, Mario Draghi ECB President will speak at 13.30 which may provide further clues to ECB policy going forward and cause movement.
Even the mere possibility of QE has weakened the pound providing sellers of Euros with a spike, well worth taking advantage of.
EURUSD is the most favourable it has been in 16 months, the dollar having surged on solid economic data and it’s safe haven status.
If you have a trade and are perched waiting to see what will happen it is worth asking yourself have you planned for every outcome? Recent movements have caught some clients out who were unprepared and willing to gamble. The currency markets are very unforgiving so to speak to a specialist about all your options feel free to make direct contact on firstname.lastname@example.org
I can potentially setup the Stop / Loss and Limit orders which will protect your rate (discussed in previous posts this week) within minutes of you making contact.