The pound trended broadly lower through June, the currency being primarily undermined by concerns over the UK’s economic trajectory.
It looks to be more of the same for the pound today. GBP/EUR is trending at €1.1167, while GBP/USD is stuck around 1.3332. GBP/AUD is flat at 1.7500, GBP/NZD is inching up at NZ$1.9374, and GBP/CAD is stuck around C$1.6935.
Read on to find out which surprise comments on monetary policy lent Sterling support ahead of the weekend…
What’s been happening?
The pound was on mixed form throughout Friday as the latest cocktail of economic and political developments had a limited impact.
On one hand, a new survey of consumer confidence found that household optimism was at its lowest level since immediately after the Brexit referendum.
However, comments from one of the newest members of the Bank of England’s (BoE) Monetary Policy Committee (MPC) Silvana Tenreyro put a floor under the pound.
While she said that market expectations of only two further interest rate hikes by 2020 seemed accurate, she also noted that the potential for Brexit to cause circumstances that dictated the need for higher borrowing costs had been largely overlooked.
GBP/EUR was stuck at opening levels thanks to survey data showing an unexpected surge in German business confidence.
Responses to the latest survey from ISO found the German private sector was feeling the most confident since 1969.
Meanwhile, GBP/USD was able to end the week higher as the US dollar was on poor form.
Demand for the euro, coupled with disappointing PMI results for November, dragged the US dollar lower.
What’s coming up?
It’s a rather slow start to the week in terms of data. There are no UK releases set for publication today, and tomorrow’s calendar is only marginally better.
The highlight of today’s Eurozone data will be the October German retail sales report, while the best the US has to offer is home sales data for last month.
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)