Pound gains on US, Australian and New Zealand dollars
Philip McHugh August 23rd 2018 - 2 minute read

The pound rallied against many of its peers on Wednesday, buoyed by some 'highly conditional' Brexit optimism.
Trade in Sterling is mixed this morning, with GBP/EUR muted at €1.1140 and GBP/CAD flat at C$1.6798, while GBP/AUD and GBP/NZD tick up to AU$1.7675 and NZ$1.9307 respectively and GBP/USD slides to $1.2880.
The euro will be in focus today, with the release of the Eurozone’s latest PMI figures potentially weakening the single currency if they reveal another month of muted growth in the bloc’s private sector.
What’s been happening?
The pound ticked higher against the majority of its peers on Wednesday as some cautious optimism regarding Brexit helped to strengthen Sterling sentiment.
This came on the back of comments from Brexit Secretary Dominic Raab late on Tuesday as he expressed confidence that the UK and EU could reach a deal by October.
Given most recent rhetoric has revolved around the idea that the UK is headed towards a no-deal Brexit, Raab’s comments came as a welcome relief to GBP investors.
The GBP/EUR exchange rate was one of the only Sterling pairings not to rise however, with GBP/EUR instead met by volatility as the euro was buoyed by weakness in the US dollar.
Meanwhile the GBP/USD exchange rate briefly broke above $1.29 to strike a new two-week high on Wednesday after Donald Trump’s former lawyer Michel Cohen pleaded guilty to violating campaign finance laws and directly implicated Trump’s involvement in the paying of ‘hush money’ to silence two of Trump’s alleged mistresses during the 2016 Presidential election.
While this is not expected to topple Trump’s presidency, it was enough to ruffle markets ahead of the US mid-terms in November.
What’s coming up?
Looking ahead, the pound is likely to slide today as the Confederation of British Industry’s (CBI) latest distribute trades survey is expected to report that UK retail activity slowed in August.
At the same time the euro may struggle to advance this morning as markets forecast a subdued reading in the Eurozone’s latest PMI figures.
Further pressure may also be applied to the single currency with the release of the Eurozone’s latest consumer confidence data this afternoon if household sentiment weakens as expected this month.
Finally the US dollar may be able to claw back some of its losses this afternoon with the publication of the latest US housing figures, with an uptick in new home sales likely to slightly bolster the appeal of USD.
Written by
Philip McHugh