The Pound Sterling to Euro (GBP/EUR) exchange rate remained within a relatively narrow range in Friday’s European trading while the Pound Sterling to Swiss Franc (GBP/CHF) and Pound Sterling to Japanese Yen (GBP/JPY) exchange rates climbed on account of the UK’s Unemployment Rate stat falling to the lowest level seen since July 2008.
#Employment rate 73.4% for Dec-Feb 2015, highest figure on record http://t.co/zNLTsoLpHm pic.twitter.com/BHQj9x00ZD
— ONS (@ONS) April 17, 2015
Furthermore, the Pound was bolstered by Average Weekly Earnings Excluding Bonuses climbing from 1.6% to 1.8% in February on the year.
Euro (EUR) Exchange Rate Pressured by IMF Extension Decline
Meanwhile, the Euro is trading tentatively after Greece informally asked the International Monetary Fund (IMF) if it would be able to delay its next loan repayment.
IMF chief Christine Lagarde commented: ‘It’s clearly not a course of action that would actually fit… We have never had an advanced economy ask for payment delays.’
Punchy from @lagarde on Greece: “Payment delays have not been granted by IMF in last 30yrs. Never had advanced economy asking for delay.”
— Ed Conway (@EdConwaySky) April 16, 2015
However, with investors beginning to seriously doubt if a deal will be made between Greece and its creditors, the Greek government is trying to boost confidence by remaining optimistic.
Greek Prime Minister Alexis Tsipras stated: ‘Despite the cacophony and erratic leaks and statements in recent days from the other side, I remain firmly optimistic that there will be an agreement by the end of the month.’
Meanwhile, the Swiss Franc was offered little support when Swiss Retail Sales contracted by -2.7% in February on the year following January’s -0.3% dip. However, the annual decline is the largest recorded since the ecostat began in 2003.
Swiss data is now thin on the ground until Thursday April 23rd when the Swiss Balance of Trade figure will be released. That report could impact the Swiss Franc to Euro (CHF/EUR), Swiss Franc to Japanese Yen (CHF/JPY) and Swiss Franc to Pound Sterling (CHF/GBP) exchange rates moderately.
The Japanese economy noted a slight improvement on Friday when the Japanese Consumer Confidence Index rose from 40.7 in February to 41.7 in March, bypassing forecasts for a smaller rise to 41.3. The improvement was the fourth consecutive month of gains. However, there are concerns about the level of spending in the nation.
Capital Economics analysts wrote: ‘The rebound in sentiment likely reflects the plunge in energy prices since the autumn, but households have chosen to save rather than spend this windfall.’
‘Indeed, the Bank of Japan’s Opinion Survey points to sluggish consumer spending, and we think that private consumption was stagnant at best last quarter.’
Pound Sterling Exchange Rate Forecast: GBP/JPY, GBP/CHF, GBP/EUR
The GBP/EUR, GBP/CHF and GBP/JPY exchange rates are likely to keep fluctuating on Friday as investors digest the UK’s wage and unemployment data.
For Dec-Feb 2015 wages including bonuses up 1.7% on a yr earlier. Wages excl bonuses up 1.8% http://t.co/XEpzd276SE pic.twitter.com/uTMW1mosfZ
— ONS (@ONS) April 17, 2015
The Pound Sterling exchange rate could be in for some influential movement on Wednesday 22nd April with the release of the Bank of England’s (BoE) meeting minutes. Any divergence in policymakers on the topic of interest rate hikes could boost the Pound exchange rate significantly.
Any hawkish tones could also play their part in Pound Sterling strengthening.
The Pound Sterling to Japanese Yen (GBP/JPY) exchange rate is reaching 178.3400. The Pound Sterling to Swiss Franc (GBP/CHF) exchange rate is trading at 1.4315; the Pound Sterling to Euro (GBP/UR) exchange rate is trending in the region of 1.3873.
