Currency Forecast Week Commencing 10th February

This week starts with a quiet day for economic data with nothing of note for the UK set for release, however tomorrow we have the British Retail Consortium announcing their retail sales figures while the main factor that could have a large influence on the currency markets is the first speach by Janet Yellen the new Head of the Federal Reserve Bank of America. In her first speach it will be really interesting to see what indicators she gives with regards to the current tapering of the US’s bond buying scheme as if she introduces any change to the current tapering levels or even just hints at this it could have a large impact on the currency markets. She speaks tomorrow at 3pm and so for anyone with a USD currency transfer it will be worth speaking with us before this in order to discuss the likely impact on your transfer and the options available to you.

Wednesday is the key day this week for Sterling with the Quarterly inflation report which will be accompanied by a speak from Bank of England (BoE) Governor Mark Carney. The inflation report is expected to show inflation holding steady around the targetted 2% level but it will be the speach that could be the most influencial. With unemployment falling a lot faster than the BoE expected I would not be surprised if Mr Carney uses this opportunity to state that interest rates are not going to be increased any time soon despite unemployment nearly at the 7% target level. So, this could really cause some Sterling weakness if he does come out with this. Also, on Wednesday the European Central Bank (ECB) President Mario Draghi speaks which will give an indication as to how the Central Bank see the single currency economy performing at present. With the threat of deflation it will again be interesting to see what Mr Draghi has to say and what the impact it will have on Euro exchange rates. Finally, on what is a busy day, the US announce their mortgage application figures which will provide an insight into how the US housing market is performing, expectation is for the figures to remain relatively low but any variance from the predicted figures could cause US Dollar volatility.

On Thursday we have another raft of key economic data with Australian unemployment figures early in the morning, the ECB monthly report, US Retail sales and another speach from Janet Yellen. All of these economic data releases have the potential to cause big waves for exchange rates and so if you need to buy or sell GBP, EUR,  USD or AUD it will be worth speaking with one of our experienced currency brokers who will be more than happy to help.

Finally, the big data release on Friday is the Eurozone Gross Domestic Product (GDP) figure which is predicted to show an improvement which would be well needed for the EUR. If this is the case then we could see some EUR strength but if the figures dissapoint on Friday then we may see some excellent opportunities to buy GBP EUR however with all the preceeding economic data releases leaving a EUR purchase until the end of the week may be risky.

So, if you need to transfer funds internationally and would like to discuss the market outlook and all the different options available to you please call us today. You can call straight through to our trading floor for free on 0800 328 5884 or if calling from abroad call us on 0044 1494 725353 alternatively email me directly on