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What can we expect from the pound this week?

currency-newsWhat can we expect from the pound this week?
GBP/EUR returned from the weekend trading in the region of €1.1305, GBP/USD has fallen below $1.2900, GBP/AUD is fluctuating around AU$1.6961, GBP/NZD has climbed 0.3% to NZ$1.7732 and GBP/CAD has risen to C$1.6624.

What should we be looking out for today? Keep scrolling to find out…

What’s been happening?

A run of poor UK data kept the pound under pressure last week and the GBP/EUR exchange rate begins Monday clinging to the €1.1300 level despite indications that the European Central Bank (ECB) plans to hold off making any adjustments to quantitative easing until later in the year.

ECB Governing Council member Francois Villeroy de Galhau stated; ‘What we have to do, and what we started to do, is to adapt the intensity of this accommodative monetary policy to the progress toward our inflation target and toward economic recovery. In the future, and this will be our decision next fall, we will go on adapting the intensity of this monetary policy.’

Meanwhile, against the backdrop of the G20 summit, UK Prime Minister Theresa May had discussions with Donald Trump that were said to have a heavy focus on trade.

Trump was quoted as saying; ‘There is no country that could possibly be closer than our countries. We have been working on a trade deal which will be a very, very big deal, a very powerful deal, great for both countries and I think we will have that done very, very quickly.’

As it stands the GBP/USD exchange rate remains on the cusp of $1.2900 following last Friday’s impressive non-farm payrolls report. The US economy added 187k positions in June, more than the forecast figure of 170k. Although the US unemployment rate rose to 4.4% from 4.3% this was due to an expansion in the participation rate. 
 
What’s coming up?

With no notable UK data to look out for today, any pound movement is more likely to be the result of news from elsewhere.

For example, the GBP/EUR exchange rate could edge higher today if the euro is weakened by the Eurozone’s Sentix investor confidence measure.

The gauge is expected to dip from 28.4 to 28.1.   

From the US we’ve got consumer credit data and later New Zealand will be releasing its retail card spending numbers. An improvement in spending would be NZD-positive.

Tomorrow the British Retail Consortium’s (BRC) like-for-like sales data is due for publication, and we have speeches from two high-ranking Bank of England (BoE) officials.

If Andy Haldane and Ben Broadbent offer up more hints that interest rates should be increased sooner rather than later the pound may start climbing against the majors.

The UK’s biggest news of the week is likely to be Wednesday’s national employment and wage figures, with any improvement in average earnings having the potential to lend the pound support.

We’re here to talk currency whenever you need us, so get in touch if you want to know more about the latest news or how it could impact your currency transfers.
 
Philip McHugh

Philip McHugh

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)

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