Good afternoon – Please find the latest news surrounding the Pound and what may happen going forward:
Sterling – Euro
The Pound has had a fairly stable week against the Euro.
Today could have created a great deal of volatility and there were some fairly swift exchange rate movements however head of the European Central Bank Mario Draghi did not announce anything of any great significance during his press conference this afternoon and the bank of England kept everything as normal regarding interest rates and Quantitative Easing.
Tomorrow morning we have European Retail Sales figures out which you would imagine will not be great so we may see a small Euro buying opportunity in the morning.
Sterling – Dollar
The Dollar is seemingly making a little fight back once again against the Pound however four factors could affect this in the short term. Firstly the BOE interest rate decision today, secondly the issue with North Korea…. Hopefully this will calm down before any major action happens however be wary that you could see swift movements for the USD should the current threats start to gain some traction.
Thirdly, we have chairman of the Federal Reserve Ben Bernanke speaking this evening on the U.S economy so be aware of potential sharp swings for the Dollar overnight depending on what he says regarding future economic policy.
Finally, we have Non-Farm Payroll data out tomorrow for the States which can actually affect all major currencies. NFP data is essentially the number of people in non agricultural employment within the U.S and the reason it can lead to market volatility is it can effect global attitude to risk – Keep your eyes peeled for this data at 13:30pm tomorrow.
Sterling – Australian Dollar/New Zealand Dollar
The Pound is still finding these two as tough opposition and with news that commodity prices had risen by over 7% recently and that the Reserve Bank of Australia have once again kept rates on hold. The strange thing with these pairings is that both Governments appear to be disappointed with how strong their currencies are however neither seems to be doing much about it.
The general outlook is that the trend may continue unless someone steps in to do something about it however if global attitude to risk suddenly decreases then there is a good chance we may see a sharp spike and a potential buying opportunity – contact me today if you want to be made aware should this situation occur.
Sterling – South African Rand
This pairing has been fairly stable of late however once again attitude to risk falling globally may lead to the ZAR weakening again along with any further troubles over in South Africa that we saw a few months back.
Sterling – Swiss Franc
Again, no major movements of late for the pound against the Swiss Franc since the huge charge the Swissy made against Sterling a few months ago – Gaining around 8 cents in a week or so. This pairing is a strange one as the Swiss Government are still not particularly happy with the strength of their currency at present so at any point we could see them bring in a new fiscal policy like we saw quite some time ago where the Swiss Franc lost 10 cents in an hour!
All in all I think the strength of the Pound will be reliant on what happens with the bank of England today and also any rumours or predictions surrounding whether or not the U.K will fall back into recession on the 25th April.
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