Sterling ended last week’s trading down against all major currencies, with EUR rates weakening to levels seen last March, around 1.13 and USD rates reaching 1.30, the lowest it’s been since November last year. The Sterling report below discusses upcoming data releases this week in what has been a quiet week so far. The table below shows the range of exchange rates for a number of currencies during the past 24 hours.
| Currency Pair | % Change | Difference on £200,000 |
|---|---|---|
| GBP/EUR | 0.32% | €714 |
| GBP/USD | 0.56% | €1,480 |
| GBP/AUD | 0.42% | AUD$1,502 |
There’s been little movement for sterling this week, with sideways movement against the EUR and USD levels returning to the 1.31s despite a slight slump at the start of the week.
Sterling movement this week will largely be influenced by the outcome of the Markit Services PMI data for June released this morning and following the Governor of the Bank of England Mark Carney’s speech on Thursday.
The Markit data release is an indicator of economic climate within an industry sector and the release is expected to show an improvement on the past two months with a reading of 54, also indicating continued expansion.
Carney’s Speech on Thursday is expected to suggest that the UK’s economic stability is robust, despite little improvement shown in past quarters economic data and the ongoing Brexit uncertainty. The speech will also be closely watched by investors, following the Bank’s decision to keep interest rates on hold last month, as any indication of a potential hike next month will likely affect confidence in the currency.
Chequers Cabinet Meeting
There could be another important market mover for the GBP this week, with the Chequers Cabinet meeting set to take place this Friday.
The Chequers summit is aimed at fixing the Government’s position on key areas of a trade deal with Brussels, but details remain vague on a reported “third way” to manage the customs arrangements at ports and the Irish border.
Any slight ambiguity following the meeting will surely add to the current frustration of EU leaders, who increased pressure on PM May yesterday, with Dutch president Mark Rutte saying that ‘urgent clarity’ was needed regarding every aspect of the future relationship between the UK and the EU.
There is clearly the potential for volatile end to the weak for Sterling, so it would be worth contacting your account manager here to discuss strategy in relation to any upcoming transfers you might have planned in the short term.
For more information on how future data releases could affect your currency requirement, call our trading floor on 01494 725 353 or email me here.
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