Following slightly disappointing inflation figures released this week on Wednesday, an interest rate in the near future is now less likely which has caused the Pound to drop. This Sterling report looks at the way Sterling exchange rates can be affected by this and other upcoming economic data releases. The table below shows the difference in a number of currencies you could have achieved when buying £200,000.00 during the high and low points this week.

Currency Pair% ChangeDifference on £200,000
GBPEUR0.57%€1,307
GBPUSD0.77%$2,179
GBPAUD0.81%AUD $2,971

Inflation drops but Retail Sales are positive

We have had a fairly flat week for Sterling exchange rates against most major currencies with very little positive movement against any of the majors and another week where the Pound has lost ground against the Dollar, leading to GBP/USD being at the lowest rate for 5 months.

On Wednesday inflation figures were released, expectations of a reading of 2.5% were missed and the reading came out at 2.4%. This led to a slight drop in value for Sterling as it makes the chances of a rate hike a little lower.

Yesterday’s economic data was a little more positive as Retail Sales figures came out and they were actually a lot better than the markets had expected, this led to a slight gain for the Pound but once again any larger movements do appear to be shackled by Brexit uncertainty.

Inflation comes out negatively but Retail Sales are positive

U.K growth figures today

This morning we have the release of U.K Growth figures and this will more than likely set the scene for the performance of Sterling over the course of the day’s trading. This release is a revision of quarter 1 figures which disappointed last month and registered at a mere 0.1% growth. Expectations are for the figure to remain at 0.1%, but any deviation from this could either make or break Sterling’s day, particularly should the figure be revised lower as this would put the U.K at 0 or negative growth for the quarter.

This isn’t quite recession territory as we would need to see two consecutive quarters of negative growth, and I feel that this quarter is only a minor blip down to the weather but as you can imagine the media will be hot on this and a lower release this morning may kick Sterling even further out of fashion.

Next week for the pound

For those overseas please be aware that we have a Bank Holiday in the U.K on Monday.

As the week progresses we have house price data on Tuesday morning, mortgage approvals data on Thursday and manufacturing figures on Friday.

On top of this there will no doubt be plenty of political news that will impact the markets along with releases from other areas of the globe that may impact the currency pairing you are following.

 

If you have a currency exchange to carry out in the coming days, weeks or months and you would like to speak to a member of our experienced dealing team then feel free to contact our trading floor on 01494 725353 or email me here and we will be more than happy to help you.

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Exchange rates on this page are interbank rates and indicate where the market is trading to show the performance of a currency pair. They are not indicative of the rates which we offer. The information on this web site is provided free of charge for information purposes only. It does not constitute advice to any person on any matter. Foreign Currency Direct plc. ("FCD") makes every reasonable effort to ensure that this information is accurate and complete but assumes no responsibility for and gives no warranty with regard to the same.