UPDATE
The Pound Sterling to Euro (GBP/EUR) exchange rate rallied by around 1.1% on Tuesday afternoon, whilst the Pound Sterling to US Dollar softened by around -0.3%.
With traders seeking investment in currencies without strong links to China in terms of trade, the pound advanced versus many of its currency peers. Additional gains can be attributed to the fact that the Bank of England (BoE) has one of the highest comparative benchmark interest rates compared with other major peers.
The Euro dived versus its currency rivals as traders made the most of Monday’s upsurge. The Euro upswing, which was the result of traders tailing off carry trades, caused a marked appreciation which opened up some attractive selling positions.
In response to better-than-expected US economic data, the ‘Greenback’ (USD) rallied versus most of its major peers. Consumer Confidence was forecast to rise from 90.9 to 93.4 in August, but the actual results reached 101.5.
The Pound Sterling to Euro (GBP/EUR) exchange rate is currently trending in the region of 1.3761.
The Pound Sterling to US Dollar (GBP/USD) exchange rate is currently trending in the region of 1.5704.
Earlier…
Pound Sterling to Euro (GBP/EUR) Exchange Rate Forecast to Edge Higher on Single Currency Overvaluation
The Pound Sterling to Euro (GBP/EUR) exchange rate advanced by around 0.4% on Tuesday morning.
With market turmoil causing uncertainty and significant volatility, traders have seen the Pound as a safer asset to park money with than most. Even the prospect of a Bank of England (BoE) benchmark interest rate hike being delayed in response to outside influences wasn’t enough to prevent Sterling gains.
The Pound Sterling to Euro (GBP/EUR) exchange rate is currently trending in the region of 1.3672.
The shared currency rallied during Monday’s European session thanks to investors unwinding carry trades. Having rallied to a three-and-a-half month high against the British asset, the common currency softened on Tuesday. Although European data produced mostly positive results, trader focus is dominated by proceedings in China. Additional Euro losses can be connected to fears that Greece’s domestic political issues could unhinge the current deal which has seen the Hellenic nation finally unlock financial aid.
The Pound Sterling to Euro (GBP/EUR) exchange rate was trending within the range of 1.3603 to 1.3698 during Tuesday’s European session.
Pound Sterling to US Dollar (GBP/USD) Exchange Rate Forecast to Edge Higher on Delayed Fed Rate Hike Bets
The Pound Sterling to US Dollar (GBP/USD) exchange rate ticked higher by around 0.2% on Tuesday morning.
With a complete absence of British economic data on Tuesday, Sterling movement will be dictated by external factors. Although there are several highly influential domestic data publications due out over the coming week, there is a possibility that they will not be as impactful with the situation in China causing so much uncertainty. Friday’s UK growth data is the publication most likely to provoke Sterling changes.
The Pound Sterling to US Dollar (GBP/USD) exchange rate is currently trending in the region of 1.5785.
The US asset is hovering near a two-month low against the British Pound as traders were forced to accept that a September Federal Reserve benchmark rate hike was off the cards. Even the US asset’s safe-haven qualities haven’t been enough to prevent the Dollar declining against many of its currency rivals. Augusts’ Consumer Confidence print, due for publication during Tuesday’s North American session, has the potential to provoke changes for the ‘Greenback’ (USD).
The Pound Sterling to US Dollar (GBP/USD) exchange rate was trending within the range of 1.5744 to 1.5799 during Tuesday’s European session.