Pound rises on reaction to Conservative manifesto
Philip McHugh November 26th 2019 - 2 minute read
- Confidence in Conservative victory sends Sterling higher
- US dollar stumbles after mixed manufacturing data
- Trade speculation limits New Zealand dollar appeal
Pound trends higher on political news
The Pound broadly strengthened on Monday as PM Boris Johnson vowed to ‘get Brexit done’ and the Conservatives remained ahead in the polls following the publication of their election manifesto.
Sterling was also supported as November’s CBI reported retail sales index bettered forecasts, helping to alleviate some of the concerns for Q4 growth inspired by last week’s UK services and manufacturing PMIs.
Political headlines will remain the driving force behind GBP exchange rate movement today, but the UK’s latest UK mortgage approvals data will also be of interest.
Widening goods trade deficit forecast to weigh on US dollar
Support for USD exchange rates was limited yesterday thanks to rising risk-appetite and a weaker-than-expected reading from the latest Chicago Fed national activity index.
Although the Dallas Fed manufacturing index showed improvement on the month, this was not enough to outweigh the disappointing nature of the other index.
Demand for the US dollar could deteriorate further this afternoon on the back of October’s advance goods trade figure if the deficit widens.
Euro exchange rates
Yesterday’s German IFO expectations index for November showed improvement, but the increase to 92.1 was less-than-forecast and failed to lend the euro much support.
The common currency could come under pressure today if the German GfK consumer confidence index declines unexpectedly.
Economists expected the gauge of sentiment to remain at 9.6. Investors will also be focusing on speeches by ECB officials including BenoCur鮼br />
Upcoming Data:
Tuesday, 26th November 2019
07:00 EUR German GfK Consumer Confidence
09:30 GBP Mortgage Approvals
13:30 USD Advance Goods Trade Balance
Written by
Philip McHugh