Exchange Rate Outlook – GBP, EUR, USD, CAD and AUD Exchange Rates
The start of March see’s a number of key economic data sets due for release which could mean we have a busy week for the currency exchange rates. Today we have mortgage approvals for the UK which will give a good insight into the UK housing market and how willing the UK banks and building societies are to lend money at present, the expectation is for approvals to increase which could bring some Sterling strength. Later on today we have Canadian industrial production figures and then a raft of economic data from the States which should give a good overview of the current performance of the American economy. Finally today we also have the President of the European Central Bank (ECB) Mario Draghi who’s speeches are always noteworthy due to his insight into the Eurozone economy. The main topic to listen out for during Mr Draghi’s speach will be deflation and whether the ECB will act to try and prevent deflation, as this is such a hot topic any comments by Mr Draghi about this or any action the Central Bank may take could well see some major EUR movement this afternoon.
On Tuesday there is less economic data due for release but probably the main economic news is the Australian interest rate decision which is expected to show interest rates remain on hold at 2.5% but it will be the accompanying statement that will be interesting as it may give an insight into the Reserve Bank of Australia’s view of their economy and whether they are considering any action in the coming months. Later in the day we have Eurozone Producer Price Index figures and some data sets for the US all of which are expected to remain steady.
On Wednesday the day starts with some more key economic data for Australia with their latest set of Gross Domestic Product (GDP) figures which are predicted to show a rise, if this is the case then we may see some AUD strength and a good opportunity for those clients looking to sell AUD. Following this we have Eurozone GDP which is also expected to show a boost which may provide the Euro with some much needed strength also announced at the same time for Europe is their latest retail sales which will give an insight into how the retailers in the single currency economy is performing. In what is a busy day for economic data release the Bank of England is due to announce their latest inflation report while in Canada the Bank of Canada will announce their latest interest rate deciion and the US are set to announce their mortgage applications meaning it could be a key day for clients looking to buy or sell CAD or USD.
On Thursday interest rate announcements take centre stage with the Bank of England and the European Central Bank both releasing their latest decisions surrounding both interest rates and also their Quantitative Easing (QE) programmes should there be any change for either economy or even the slightest mention of a change in interest rates of QE then we could see some big currency market movement. Also on Thursday we have US unemployment figures which is likely to give a good insight into how the US job market is performing.
Finally on Friday the busy week ends with Canadian uneployment figures and also the important US non-farm payroll figures which is often one of the most unpredictable data sets announced and so often causes a lot of USD exchange rate movement. So, with these data releases due it could be yet another key day for USD and CAD exchange rates.
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