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GBP USD Exchange Rate Rises Sharply Following Fed Rate Hike 

Sterling hangs in the balance ahead of Fed and BoE decisions

Sterling exchange rates hang in the balance ahead of today’s Federal Reserve FOMC meeting and tomorrow’s Bank of England Monetary policy meeting. The pound has been one of the strongest performing currencies of 2024, mostly helped by the prospect of higher for longer interest rates in the UK vs the Eurozone and the US. UK interest rates currently sit at 5.25% and there is an expectation for rates to be cut by 100 basis points by...

GBPEUR hits 1.17 – will the pound continue to rise?

GBPEUR exchange rates rose to 4-month highs during yesterday’s session, hitting 1.17 on the interbank market. Sterling is trading 0.6% off the 52-week high against the euro, making now an opportune time for sterling sellers. Sterling has remained resilient against the dollar, holding above the key threshold of 1.27. Cable (GBPUSD) rates are 0.7% off the 5-month high. Services & Manufacturing data Purchasing Managers Index (PMI) surveys senior executives within the manufacturing and...

Sterling rises following UK inflation release – will the pound get stronger?

UK inflation data released this morning confirmed a rise in CPI inflation from 3.9% to 4%, causing an immediate rise in pound sterling’s value. The markets were expecting inflation to continue to drop off as it has for much of the last year. Sticky inflation poses a threat to the prospect of interest rates being cut in the UK. The Bank of England have kept interest rates above 5% in attempt to cool down the rise in prices.

Sterling stable ahead of US inflation and UK growth data

Following a positive start to 2024, sterling remains at a stable level against its key counterparts the euro and US dollar. GBPEUR is 1.3% off the 6-month high and 2% higher than the 6-month low. Cable (GBPUSD) rates are 3% lower than the 6-month high but almost 5.5% above the 6-month low. On a 6-monthly basis, now is positive time to be securing euros and dollars from pounds. There is a potential for sterling weakness as we progress into...

Could the Pound fall in value if the UK officially slips into recession?

Despite being a quiet week for economic data releases, on Friday there is arguably one of the most important data releases for the UK economy so far in 2024 as GDP figures for November will be released. In the third quarter of 2023 the UK officially contracted after revised figures showed a slight drop in economic output of -0.1% across the 3-month period of July, August and September. For the UK to into an official recession...

What’s in store for Sterling in 2024?

The begin to the year for sterling exchange rates has been a mixed bag. The pound is slightly stronger vs the euro in 2024 but has lost some value against the dollar over the first week’s trading. Forecast data collated by Lumon from around 50 big banks and institutions, Nomura, BNP, Standard Chartered to name a few, currently suggests that we could see a weaker pound moving forward into 2024. There is a clear bias for...

Sterling weakens ahead of UK growth data

Central Bank Speeches Sterling exchange rates are once again on the back foot following comments made by several monetary policy committee members. Earlier this week, chief economist Huw Pill suggested it was reasonable for the market to expect interest rate cuts from the middle of next year. Higher UK interest rates support the value of sterling by making the currency more attractive to overseas investment. A drop in interest rates would lead to a softer pound. However, at a conference in Dublin held by the Central...
GBP EUR Exchange Rate: Weekly Review May 21st  

The Struggle Continues for Sterling

Will we see pound sterling exchange rates continue to fall? The pound has traded more weakly in recent weeks as evidence of a slowdown in the UK economy persists. The Bank of England has also indicated it is now most likely finished raising interest rates. Higher interest rates are in general a reason for currency strength. Signs of a lower interest rate are therefore typically likely to lead to currency weakness. In the last 24 hours, the Bank of England chief economist Huw Pill, has stated interest rate...
GBP EUR Drops After Bank of England Recession Warnings 

Will the Bank of England decision cause sterling to rise or fall?

Will the Bank of England decision cause sterling to rise or fall? Sterling exchange rates hang in the balance this morning ahead of the Bank of England interest rate decision. The outcome of the decision could cause movement in either direction for sterling exchange rates. The Bank’s monetary policy committee are expected to vote for interest rates to remain unchanged. GBPEUR is trading within half a cent of the 5-month low. GBPUSD (cable) is trading 10 cents lower vs the highs seen in July. This represents...
GBP EUR Could Head Lower After Growth Revisions

Will the pound rise or fall on the Bank of England decision?

Sterling could be under pressure tomorrow The pound could suffer at the hands of the Bank of England tomorrow, as the UK's central bank meets to discuss its latest policy. Expectations are for a pause in their interest rate hike cycle, with the market likely to be focussed on the duration of this pause. Could we see sterling weaker as investors are satisfied that no more hikes will happen? Or will the pound rise as the 'higher for longer' expectations see investors backing the pound. What does history...