The Pound Sterling to Euro (GBP/EUR) exchange rate climbed on Friday as investors priced in the possibility of Greece defaulting on its upcoming International Monetary Fund (IMF) repayment, the Pound Sterling to Canadian Dollar (GBP/CAD) and Pound Sterling to US Dollar (GBP/USD) exchange rates also advanced ahead of US Durable Goods Orders and Bank of Canada (BOC) statements.
Eurozone finance ministers met on Friday and by all accounts attempted to kick Greece into action. As a result of Greece’s telling off, economists and investors believe that a Greek default could occur and lead to a Grexit.
#Greece's default probability jumps as Greek FinMin Varoufakis said to take hammering from frustrated EU ministers. pic.twitter.com/lr6D4UalOk
— Holger Zschaepitz (@Schuldensuehner) April 24, 2015
The Pound Sterling to Euro (GBP/EUR) exchange rate was trading lower in the first half of Friday’s European session while the Pound Sterling to Canadian Dollar (GBP/CAD) and Pound Sterling to US Dollar (GBP/USD) exchange rates were trending higher before the US Durable Goods Orders figure and Bank of Canada (BOC) Stephen Poloz’s statement.
Meanwhile, ongoing negotiations between Greece and its creditors appear to be hostile in Friday’s finance minister meeting.
Extremely unfriendly the environment towards #Greece inside #eurogroup main message "get your act together" says EU official.
— Eleni Varvitsiotis (@Elbarbie) April 24, 2015
EU Commissioner @pierremoscovici on #Greece: Progress has been made, but very little. Time is running out. #Eurogroup pic.twitter.com/3BTGju03zZ
— Elena Becatoros (@ElenaBec) April 24, 2015
The Pound sterling to Euro (GBP/EUR) and Pound Sterling to Canadian Dollar (GBP/CAD) exchange rates were both trending lower on Thursday after UK Retail Sales slipped by -0.5%, while the Pound Sterling to US Dollar (GBP/USD) exchange rate was trading within a narrow range after US data disappointed.
The US Markit Manufacturing PMI fell from 55.7 to 54.2 in April.
Earlier… The Pound Sterling to Euro (GBP/EUR), Pound Sterling to US Dollar (GBP/USD) and Pound Sterling to Canadian Dollar (GBP/CAD) exchange rates were trading lower on Thursday ahead of UK Retail Sales ecostats.
Earlier… The Pound Sterling to Euro (GBP/EUR), Pound Sterling to US Dollar (GBP/USD) and Pound Sterling to Canadian Dollar (GBP/CAD) exchange rates all jumped in Wednesday’s European session after the Bank of England (BoE) released its latest meeting minutes—immediately after the release GBP/USD jumped 20 pips.
The minutes showed policymakers remained united on the prospect of not hiking interest rates yet; however, two members of the Monetary Policy Committee (MPC) suggested that the vote was finely balanced.
It appears as if it can only be a matter of time before the Bank of England (BoE) begins to see hawkish members of the MPC, such as Ian McCafferty and Martin Weale, break away from the group and vote in favour of increasing borrowing costs like they did last year.
The Canadian Dollar recovered losses on Wednesday after Tuesday’s disappointing six-month low Wholesale Sales figure; the ecostat recorded a -0.4% contraction instead of the +0.5% growth forecast.
Meanwhile, crude oil prices declined on Wednesday as tensions in the Middle East eased. Saudi Arabia announced on Tuesday that it was putting an end to its month-long airstrike campaign which had been attacking Houthi rebels in Yemen.
However, economists are suggesting the rise in demand for oil could help to prop up the price and potentially allow it to maintain its $10 gains made in April.
Oil trading expert Ian Taylor commented: ‘We will probably see one more dip in the second quarter but prices probably won’t go below this year’s lows. Gasoline is coming back with a vengeance. Refining margins are not as bad as we had feared.’
It appears as if an increasing amount of economists are predicting rising oil prices and therefore the Canadian Dollar could be in for some support in coming months.
Meanwhile, in Canadian politics, finance minister Joe Oliver released the Canadian budget during North American trading and boosted sentiment by keeping the 2011 Conservative election promise of returning Canada to a surplus this year.
Oliver spoke about the pre-election tax cuts and other aspects of policy stating: ‘Canadians need a break. Their expenses are significant. It’s important for us to make life as affordable as we can.’
The Canadian Dollar to Pound Sterling (CAD/GBP), Canadian Dollar to Euro (CAD/EUR) and Canadian Dollar to US Dollar (CAD/USD) exchange rates may experience some movement on account of oil price fluctuations, but with no further Canadian domestic data out in the rest of the week, the ‘Loonie’ commodity currency is vulnerable to global developments.
US Dollar (USD) Exchange Rate Forecast: USD/CAD, USD/GBP, USD/EUR
The US Dollar to Pound Sterling (USD/GBP), US Dollar to Euro (USD/EUR) and US Dollar to Canadian Dollar (USD/CAD) exchange rates could all be in for some interesting fluctuations later in Wednesday’s trading with the release of US MBA Mortgage Applications, US Existing Home Sales and US Crude Oil Inventories stats.
The oil inventory could create some US Dollar to Canadian Dollar (USD/CAD) exchange rate movement as investors attempt to predict future oil numbers and prices.
Meanwhile, the strong US Dollar exchange rate has been causing problems for some businesses with many investors speculating that the Fed could consider delaying interest rate hikes as the strong ‘Greenback’ plays havoc with the global economy.
Investment expert Micahel Vogelzang stated: ‘The question is who is using the US Dollar as an excuse? It’s a very challenging problem for the Fed. Rates are going to be harder to raise than most people think because the Fed is boxed in by a very complex set of circumstances that includes a strong US Dollar.’
The most influential day for the US Dollar exchange rate is likely to be Friday with the release of the US Durable Goods Orders figure.
Euro (EUR) Exchange Rate Forecast: EUR/GBP, EUR/USD, EUR/CAD
The Euro exchange rate is trading tentatively amid ongoing Greek negotiations, which appear to be making very little progress.
Meanwhile, the Euro could experience movement on account of data this week including Wednesday’s Eurozone Consumer Confidence. The ecostat is expected to come in at -2.5 in April after the previous month’s -3.7 recording.
Thursday could be another exciting day for Euro trading with the release of Markit’s German, French and Eurozone Composite, Manufacturing and Services Purchasing Managers Indexes (PMI). Any negative readings could place heavy pressure on the Euro to Pound Sterling (EUR/GBP), Euro to Canadian Dollar (EUR/CAD) and Euro to US Dollar (EUR/USD) exchange rates.
Pound Sterling to Euro (GBP/EUR), US Dollar (GBP/USD) and Canadian Dollar (GBP/CAD) Exchange Rate Forecast
The Pound Sterling to Euro (GBP/EUR), Pound Sterling to Canadian Dollar (GBP/CAD) and Pound Sterling to US Dollar (GBP/USD) exchange rates could all be in for fluctuations on Thursday with the release of UK Public Sector Net Borrowing and UK Retail Sales ecostats.
UK data has been improving recently and further strong figures could lead investors to speculate that the BoE may be inclined to hike interest rates in the near future and enable the Pound Sterling exchange rate to rally.
GBP jumping on the back of #BoE minutes. GBP/USD heading back to 1.50 test zone #FX
— Joshua Raymond (@Josh_CityIndex) April 22, 2015
The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate is reaching 1.8405. The Pound Sterling to US Dollar (GBP/USD) exchange rate is trading at 1.5032; the Pound Sterling to Euro (GBP/EUR) exchange rate is trending in the region of 1.4012.