last Friday saw the US post some better than expected non-farm payroll data which saw GBPUSD exchange rates drop below 1.60. This was quite a surprise to many as during October the US experienced 16 days of a government shutdown.
Last week the US also claimed that US GDP now stands at 2.8% which could see the Federal Reserve slowing down their current QE programme which involves USD$85bn per month. This could mean longer term Dollar strength.
On Wednesday the UK releases both unemployment data and also the Bank of England Inflation Report. Last week the ECB decided to cut interest rates after very low inflation figures out the week before.
Recently Mark Carney’s stance has been to keep the base rate on hold until UK unemployment drops to 7%. If inflation comes out higher this could put some pressure on the Bank of England to look at a change in monetary policy a lot sooner which could result in Sterling strength.
Germany published their own set of inflation data tomorrow morning and as the leading Eurozone economy any slowdown in inflation could add further credibility as to why the ECB cut interest rates last week. If the inflation is low expect the Euro to weaken against both Sterling and the US Dollar.
If you’re considering making a currency transfer and this week and want to get a free quote when transferring currency please do not hesitate to contact me Tom Holian [email protected]