After soaring in response to the Conservative’s decisive election victory the pound quickly began shedding ground through Friday’s session.
- Pound struggles for direction amid political anxiety
- Disappointing industrial and manufacturing production weigh on US dollar
- New Zealand dollar rallies on surprise manufacturing PMI result
Political jitters keep pound under pressure
A lack of fresh UK data saw the pound struggling to gain any particular traction ahead of the weekend, with the currency hampered by political anxiety.
As political tensions mount ahead of the December general election the potential for GBP exchange rate gains looks limited.
However, if markets see reason to bet on the prospect of a parliamentary majority this could help the pound return to a positive footing.
Housing data may dent US dollar
The mood towards the US dollar soured on Friday thanks to a sharper-than-expected slowdown in October’s manufacturing and industrial production figures.
Further losses could be in store for the US dollar this afternoon if the latest NAHB housing market index shows any signs of weakness.
Evidence of a slowing housing market would give investors fresh incentive to sell out of the US dollar as worries over the economic outlook persist.
New Zealand dollar gains ahead of inflation data
NZD exchange rates rebounded strongly ahead of the weekend in the wake of an unexpectedly positive manufacturing PMI.
The index saw a surprise return to positive growth in October, picking up from 48.8 to 52.6 and bolstering confidence in the underlying health of the New Zealand economy.
The New Zealand dollar could gain further ground this evening if the third quarter producer price index strengthens.
Signs of increasing inflationary pressure would give the Reserve Bank of New Zealand (RBNZ) more reason to keep interest rates on hold.
Monday, 18th November 2019
15:00 USD NAHB Housing Market Index
21:45 NZD Producer Price Index
Joining the corporate trading desk in 2007, Phil now over sees all of Currencies Direct’s corporate dealing activity. Having gained experience working with hundreds of businesses to optimise international payments processes and execute comprehensive risk management strategies, Phil currently works with a portfolio of corporate clients whilst managing Currencies Direct’s overall market exposure
Phil has FCA approval and has completed the Certificate in International Treasury Management (CertiTM)