UK Exits Deflation, GBP/EUR & GBP/USD Exchange Rates Rise
The Pound Sterling to Euro (GBP/EUR) and Pound Sterling to US Dollar (GBP/USD) exchange rates gained over the course of the European session as the UK was shown to have emerged from deflation, as forecast by economists.
Further deterioration in the negotiations between Greece and its creditors also contributed to the GBP/EUR gains while US Housing starts data fell short of forecasts and reduced demand for the ‘Greenback’.
The Pound Sterling to US Dollar (GBP/USD) exchange rate was trending in the region of 1.5623
The Pound Sterling to Euro (GBP/EUR) exchange rate was trending in the region of 1.3912
Earlier…
Newsflash – GBP/USD Trends at 1.56, Further Gains Ahead?
Prior to the publication of the UK’s inflation data, the Pound Sterling to US Dollar (GBP/USD) exchange rate was trending in the region of 1.56.
The Pound was able to gain on its North American peer as US industrial production data fell short of the mark and the pairing could advance further still in the hours ahead if the UK’s inflation data shows the increase forecast by economists.
The GBP/EUR exchange rate was also holding at 1.38 against the Euro before the CPI figures were released.
Earlier…
GBP/USD Holds Gains as US Industrial/Manufacturing Production Data Disappoints
The Pound Sterling to US Dollar (GBP/USD) exchange rate continued trending well above the 1.55 level as US Industrial and Manufacturing Production fell unexpectedly in May.
Both declined by -0.2% instead of showing the respective 0.2% and 0.3% gains anticipated.
Tomorrow’s UK CPI data is likely to spark notable GBP volatility.
The Pound Sterling to US Dollar (GBP/USD) exchange rate is trending in the region of 1.5568.
Earlier…
Newsflash: Eurozone Trade Surplus Widens, US Industrial/Manufacturing Production Data Ahead
The Pound managed to continue trending above the 1.38 level against its European rival even as the Eurozone’s trade balance report showed that the nation’s trade surplus widened by more-than-anticipated.
According to The Australian; ‘Adjusting for seasonality, exports rose 1.1%, a slower pace than in March, while imports fell 1.6%, having jumped the previous month. That performance indicates the Euro’s depreciation since May 2014 has yet to prove a game changer for exporters, but falling imports may nonetheless help support growth this quarter. Figures released last week showed the weak Euro did little to boost Eurozone economic growth in the first quarter as imports grew much more quickly than exports.’
Later today the GBP/USD exchange rate could fluctuate in response to the release of the US Industrial and Manufacturing Production reports.
Out is believed to have increased, and if that proves to be the case ‘Cable’ could slide.
The Pound Sterling to Euro (GBP/EUR) exchange rate is trending in the region of 1.3805
The Pound Sterling to US Dollar (GBP/USD) exchange rate is trending in the region of 1.5489
Earlier…
The Pound Sterling to Euro (GBP/EUR) exchange rate began the week trending in the region of 1.3820 while the Pound Sterling to US Dollar (GBP/USD) exchange rate remained above 1.55, both pairings could extend gains if the UK’s Consumer Price Index shows an uptick in inflation.
Pound Sterling to Euro (GBP/EUR) and Pound Sterling to US Dollar (GBP/USD) Exchange Rate News: Sterling Supported by Construction Data, UK GDP Revisions – S&P’s Makes UK Outlook Negative
At the close of last week both the Pound Sterling to Euro (GBP/EUR) and Pound Sterling to US Dollar (GBP/USD) exchange rates advanced as the British currency was supported by domestic news.
Following on from the week’s earlier upbeat UK Industrial Production report, annual British Construction Output also exceeded estimates.
The Pound Sterling to Euro (GBP/EUR) exchange rate hit a high of 1.3878
The Office for National Statistics (ONS) further improved Sterling sentiment by announcing that (due to a recalculation in the way growth in the construction sector is measured) the UK economy actually expanded by more-than-anticipated last year.
Markit economist Chris Williamson noted; ‘The UK economic upturn over the past year has been stronger than previously thought after substantial data revisions show that the construction sector has not acted as such a drag on the economy. The revisions bring the economy’s performance more into line with recent survey evidence.’
However, the Pound’s gains were a little limited as Standard & Poor’s slashed its outlook for the UK economy to ‘negative’ from ‘stable’. Their decision was based on the potential economic uncertainty created by the upcoming in-out EU referendum.
The Pound Sterling to US Dollar (GBP/USD) exchange rate achieved a high of 1.5565
Euro to Pound Sterling (EUR/GBP) Exchange Rate Forecast – Greek Talks Disintegrate, Rising Grexit Odds Push Euro Lower before Trade Data
The Euro to Pound Sterling (EUR/GBP) exchange rate began the week trending in a softer position as investors processed the fact that the latest round of Greek bailout negotiations ended within 45 minutes, with no notable progress having been made.
According to German Vice Chancellor and Economy Minister Sigmar Gabriel; ‘The shadow of a Greek exit from the Eurozone is becoming increasingly perceptible. Greece’s game theorists are gambling the future of their country. And Europe’s too.’
Further EUR/GBP exchange rate movement could occur today as the Eurozone publishes its trade balance figures for April.
However, any developments in the Greek situation are also likely to have a notable impact on trading.
The Euro to Pound Sterling (EUR/GBP) exchange rate fell to a low of 0.7202
US Dollar to Pound Sterling (USD/GBP) Exchange Rate Forecast – ‘Cable’ Dips Despite Rise in US Consumer Confidence, FOMC Statement, US CPI Data Ahead
On Friday the US Dollar to Pound Sterling (USD/GBP) exchange rate softened slightly despite the US University of Michigan Confidence Index printing more strongly than anticipated.
The sentiment measure had been expected to rise from 90.7 to 91.4 but it actually jumped to 94.6.
Economist Millan Mulraine said of the report; ‘While more progress needs to be seen before the Fed feels sufficiently confidence in the sustainability of the recovery, they will certainly take comfort in the fact that things are beginning to move in the right direction.’
Even after the report was published the Pound Sterling to US Dollar (GBP/USD) exchange rate was able to record a daily gain of almost half a cent.
However, while GBP/USD is currently trending above 1.55, the pairing could reverse last week’s gains if the Federal Open Market Committee (FOMC) delivers a hawkish policy statement on Wednesday or if the US Consumer Price Index reveals a solid increase in inflation in the world’s largest economy.
The US Dollar to Pound Sterling (USD/GBP) exchange rate fell to a low of 0.6439
Pound Sterling to Euro (GBP/EUR) and Pound Sterling to US Dollar (GBP/USD) Exchange Rate Forecast: UK Inflation Data, Employment Figures, BoE Minutes and Retail Sales News Could Boost British Pound this Week
Whether or not the Pound is able to continue its current uptrend against the Euro and US Dollar depends on how strongly this week’s key UK data prints.
There are a number of reports to be aware of, with tomorrow’s UK Consumer Price Index being perhaps the most influential.
The UK CPI is set to show that the nation emerged from deflation territory in May, a result which would be Pound-supportive.
An annual figure above the 0.1% currently forecast would be well received by investors.
As the week progresses further GBP/EUR, GBP/USD exchange rate fluctuations are likely to be caused by the UK’s employment stats, the publication of the Bank of England’s meeting minutes and domestic retail sales figures.
Any results which increase the odds of the BoE raising interest rates in the first quarter of 2016 would bolster the Pound.
The Euro to Pound Sterling (EUR/GBP) exchange rate was trading in the region of 0.7240, the Pound Sterling to US Dollar (GBP/USD) exchange rate was trending in the region of 1.5532, the US Dollar to Pound Sterling (USD/GBP) exchange rate was trading in the region of 0.6439, the Pound Sterling to Euro (GBP/EUR) exchange rate was trending in the region of 1.3634