Pound Sterling Exchange Rate Forecasts, Currency News, Predictions and Outlook
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The article provides updates on the pound sterling exchange rate forecasts, currency news, predictions, and outlook. It mentions that the pound sterling is being weighed down by a dovish shift in Bank of England (BoE) rate cut expectations, leading to a weakening of the pound. The FTSE has broken to new all-time highs while the sterling slides due to the dovish shift in the BoE. The article also highlights that markets are on alert for a potential yen intervention by the Bank of Japan. Overall, the pound's exchange rates are dominated by speculation about the BoE's actions. The pound has also slumped to a three-month low against the Canadian dollar. The article provides various news updates related to the pound sterling, the BoE, the UK economy, and exchange rate forecasts.
#PoundSterling #ExchangeRate #CurrencyNews #BankOfEngland #UkEconomy #Ftse #DovishShift #BoeRateCut #YenIntervention #CanadianDollar
Pound Sterling Exchange Rate Forecasts, Currency News, Predictions and Outlook
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The article provides updates on the pound sterling exchange rate forecasts, currency news, predictions, and outlook. It mentions that the pound sterling is being weighed down by a dovish shift in Bank of England (BoE) rate cut expectations, leading to a weakening of the pound. The FTSE has broken to new all-time highs while the sterling slides due to the dovish shift in the BoE. The article also highlights that markets are on alert for a potential yen intervention by the Bank of Japan. Overall, the pound's exchange rates are dominated by speculation about the BoE's actions. The pound has also slumped to a three-month low against the Canadian dollar. The article provides various news updates related to the pound sterling, the BoE, the UK economy, and exchange rate forecasts.
#PoundSterling #ExchangeRate #CurrencyNews #BankOfEngland #UkEconomy #Ftse #DovishShift #BoeRateCut #YenIntervention #CanadianDollar
Pound To Australian Dollar Weekly Forecast, News: PMIs To Drive GBP/AUD Volatility?
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The Pound to Australian Dollar exchange rate may dip this week if strong AU PMIs boost the Aussie, although potential RBA rate cut bets from easing AU inflation could weaken AUD. GBP/AUD traded in a wide range last week amid a shifting market sentiment and mixed data releases. The pairing closed Friday’s session at around AU$1.9351. On Tuesday, the UK’s latest jobs data sparked GBP volatility. Unemployment rose more than expected to 4.2% in February, hitting a six-month high and edging higher from the previous month’s upwardly revised 4%. Signs of a loosening labour market pressured GBP exchange rates, however, with wage growth hitting a two-and-a-half year high, confirmation that earnings are outpacing inflation served to offset GBP’s initial losses. On Wednesday, a slightly warmer-than-expected batch of inflation data saw markets dial back their Bank of England (BoE) interest rate speculations. However, accompanying commentary from BoE Governor Andrew Bailey saw policymaker’s largely shrugging off the hotter-than-forecast inflation print, affirming that the central bank remains confident that UK inflation will fall to the BoE’s target rate of 2% in the summer months. Bailey also stated that UK inflation would likely undergo a ‘sharp drop’ in April, leaving Sterling to relinquish its previous gains. Australian Dollar (AUD) strengthened as the week opened, as rising commodity prices lifted the commodity-driven ‘Aussie’. Following this, AUD then softened overnight heading into Tuesday’s session, despite a better-than-forecast Chinese GDP print. China’s economy grew more than forecast, rising by 5.3% in the first quarter of 2024. However, despite AUD’s status as a proxy for the Chinese economy, a souring market mood sapped investor interest in the highly risk-sensitive Australian Dollar. Escalating tensions in the Middle East saw investors favouring safer assets, leaving the ‘Aussie’ rudderless. Then on Wednesday, a smaller-than-expected rise in AU unemployment last month offered AUD some support. Unemployment edged higher to 3.8%, rather than jumping to 3.9%, enabling AUD to post some modest gains against its rivals. Coming up, Australia’s latest preliminary PMIs are due for release on Tuesday. Should the data print as forecast, AUD could edge higher amid signs of increased economic activity. The UK’s latest PMIs are also due to print on Tuesday. Another slowdown in the UK’s vital services sector could dampen investor interest in GBP. On Wednesday, the latest AU inflation print is then set for release. Economists expect to see headline inflation ease to 3.4%, falling from the previous quarter’s 4.1%. This could lead to ramped up Reserve Bank of Australia’s (RBA) interest rate cut bets, thereby sinking AUD.
Pound To Australian Dollar Weekly Forecast, News: PMIs To Drive GBP/AUD Volatility?
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The Pound to Australian Dollar exchange rate may dip this week if strong AU PMIs boost the Aussie, although potential RBA rate cut bets from easing AU inflation could weaken AUD. GBP/AUD traded in a wide range last week amid a shifting market sentiment and mixed data releases. The pairing closed Friday’s session at around AU$1.9351. On Tuesday, the UK’s latest jobs data sparked GBP volatility. Unemployment rose more than expected to 4.2% in February, hitting a six-month high and edging higher from the previous month’s upwardly revised 4%. Signs of a loosening labour market pressured GBP exchange rates, however, with wage growth hitting a two-and-a-half year high, confirmation that earnings are outpacing inflation served to offset GBP’s initial losses. On Wednesday, a slightly warmer-than-expected batch of inflation data saw markets dial back their Bank of England (BoE) interest rate speculations. However, accompanying commentary from BoE Governor Andrew Bailey saw policymaker’s largely shrugging off the hotter-than-forecast inflation print, affirming that the central bank remains confident that UK inflation will fall to the BoE’s target rate of 2% in the summer months. Bailey also stated that UK inflation would likely undergo a ‘sharp drop’ in April, leaving Sterling to relinquish its previous gains. Australian Dollar (AUD) strengthened as the week opened, as rising commodity prices lifted the commodity-driven ‘Aussie’. Following this, AUD then softened overnight heading into Tuesday’s session, despite a better-than-forecast Chinese GDP print. China’s economy grew more than forecast, rising by 5.3% in the first quarter of 2024. However, despite AUD’s status as a proxy for the Chinese economy, a souring market mood sapped investor interest in the highly risk-sensitive Australian Dollar. Escalating tensions in the Middle East saw investors favouring safer assets, leaving the ‘Aussie’ rudderless. Then on Wednesday, a smaller-than-expected rise in AU unemployment last month offered AUD some support. Unemployment edged higher to 3.8%, rather than jumping to 3.9%, enabling AUD to post some modest gains against its rivals. Coming up, Australia’s latest preliminary PMIs are due for release on Tuesday. Should the data print as forecast, AUD could edge higher amid signs of increased economic activity. The UK’s latest PMIs are also due to print on Tuesday. Another slowdown in the UK’s vital services sector could dampen investor interest in GBP. On Wednesday, the latest AU inflation print is then set for release. Economists expect to see headline inflation ease to 3.4%, falling from the previous quarter’s 4.1%. This could lead to ramped up Reserve Bank of Australia’s (RBA) interest rate cut bets, thereby sinking AUD.
Pound To Dollar Week Ahead Forecast, News: GBP Trades Near Five-Month Low
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Pound Sterling (GBP) traded in a wide range against the US Dollar (USD) as an influx of macroeconomic data releases coupled with escalating tensions in the Middle East saw the currency pairing experience volatility. The Pound to US Dollar (GBP/USD) exchange rate traded in a wide range last week as an inflow of both UK and US data releases coupled with escalating tensions in the Middle East saw the currency pairing fluctuate. The GBP/USD was trading at around $1.2450, virtually unchanged from Friday’s opening levels. The US Dollar (USD) started the week firming against the majority of its peers as tensions escalated in the Middle East following reports of a drone strike from Iran onto Israel. On Tuesday, USD held strong and traded near a five-month high against many of its counterparts as an anxious market mood kept the safe-haven currency afloat. On Wednesday, the US Dollar faced resistance as there was a modest pullback in US Treasury yields. On Thursday, better-than-forecast US jobless claims supported the ‘Greenback’. Following reports that Israel enacted a drone and missile attack on the Iranian city of Isfahan, escalation in the conflict in the Middle East sapped the market mood, underpinning the safe-haven currency. Pound (GBP) began the week trading mostly flat against the majority of its peers following the publication of the UK’s latest jobs data on Tuesday, which showed a jump in unemployment. In February, the unemployment rate increased to 4.2% from an upwardly revised 4% reading in January. Furthermore, wage growth cooled in the three months leading up to February, with the reading printing at 6%, down from a previous 6.1%. Both figures served to undermined Sterling sentiment on Tuesday on the back of increasing bets that the Bank of England (BoE) will cut interest rates in the summer. On Wednesday, the pound enjoyed some modest support following the publication of latest UK Consumer Price Index (CPI). Both headline and core inflation levels cooled less-than-expected for March’s reading. The pound closed the week firming against the majority of its peers despite the release of underwhelming UK retail sales figures. Looking ahead, the primary driver of movement for the GBP/USD exchange rate this week is likely to be an array of US macroeconomic data. On Tuesday, the US will release its latest S&P Global manufacturing and services PMIs. With both sets of data expected to have slightly ticked up, USD may catch bids early this week. Moving into Wednesday, the latest domestic durable goods orders are forecast to plummet. On Thursday, the latest US GDP data for the first quarter of 2024 is also expected to show a large downturn which may see USD exchange rates weaken. Moving into Friday, the latest core PCE price index is forecast to decrease. Turning to the Pound, a data-light week may mean that Sterling struggles to find a clear trajectory for the majority of the week, which could leave GBP exchange rates vulnerable to the ever-shifting market mood. The only data release of note this week will come in the form of the UK’s latest flash manufacturing and services PMIs for April.
#Pound #Dollar #Gbp/usd #MacroeconomicData #MiddleEastTensions #BankOfEngland #UkJobsData #UkConsumerPriceIndex #UsMacroeconomicData
Pound To Dollar Week Ahead Forecast, News: GBP Trades Near Five-Month Low
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Pound Sterling (GBP) traded in a wide range against the US Dollar (USD) as an influx of macroeconomic data releases coupled with escalating tensions in the Middle East saw the currency pairing experience volatility. The Pound to US Dollar (GBP/USD) exchange rate traded in a wide range last week as an inflow of both UK and US data releases coupled with escalating tensions in the Middle East saw the currency pairing fluctuate. The GBP/USD was trading at around $1.2450, virtually unchanged from Friday’s opening levels. The US Dollar (USD) started the week firming against the majority of its peers as tensions escalated in the Middle East following reports of a drone strike from Iran onto Israel. On Tuesday, USD held strong and traded near a five-month high against many of its counterparts as an anxious market mood kept the safe-haven currency afloat. On Wednesday, the US Dollar faced resistance as there was a modest pullback in US Treasury yields. On Thursday, better-than-forecast US jobless claims supported the ‘Greenback’. Following reports that Israel enacted a drone and missile attack on the Iranian city of Isfahan, escalation in the conflict in the Middle East sapped the market mood, underpinning the safe-haven currency. Pound (GBP) began the week trading mostly flat against the majority of its peers following the publication of the UK’s latest jobs data on Tuesday, which showed a jump in unemployment. In February, the unemployment rate increased to 4.2% from an upwardly revised 4% reading in January. Furthermore, wage growth cooled in the three months leading up to February, with the reading printing at 6%, down from a previous 6.1%. Both figures served to undermined Sterling sentiment on Tuesday on the back of increasing bets that the Bank of England (BoE) will cut interest rates in the summer. On Wednesday, the pound enjoyed some modest support following the publication of latest UK Consumer Price Index (CPI). Both headline and core inflation levels cooled less-than-expected for March’s reading. The pound closed the week firming against the majority of its peers despite the release of underwhelming UK retail sales figures. Looking ahead, the primary driver of movement for the GBP/USD exchange rate this week is likely to be an array of US macroeconomic data. On Tuesday, the US will release its latest S&P Global manufacturing and services PMIs. With both sets of data expected to have slightly ticked up, USD may catch bids early this week. Moving into Wednesday, the latest domestic durable goods orders are forecast to plummet. On Thursday, the latest US GDP data for the first quarter of 2024 is also expected to show a large downturn which may see USD exchange rates weaken. Moving into Friday, the latest core PCE price index is forecast to decrease. Turning to the Pound, a data-light week may mean that Sterling struggles to find a clear trajectory for the majority of the week, which could leave GBP exchange rates vulnerable to the ever-shifting market mood. The only data release of note this week will come in the form of the UK’s latest flash manufacturing and services PMIs for April.
#Pound #Dollar #Gbp/usd #MacroeconomicData #MiddleEastTensions #BankOfEngland #UkJobsData #UkConsumerPriceIndex #UsMacroeconomicData
Pound To Dollar Week Ahead Forecast, News: GBP Trades Near Five-Month Low
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Pound Sterling (GBP) traded in a wide range against the US Dollar (USD) as an influx of macroeconomic data releases coupled with escalating tensions in the Middle East saw the currency pairing experience volatility. The Pound to US Dollar (GBP/USD) exchange rate traded in a wide range last week as an inflow of both UK and US data releases coupled with escalating tensions in the Middle East saw the currency pairing fluctuate. The GBP/USD was trading at around $1.2450, virtually unchanged from Friday’s opening levels. The US Dollar (USD) started the week firming against the majority of its peers as tensions escalated in the Middle East following reports of a drone strike from Iran onto Israel. On Tuesday, USD held strong and traded near a five-month high against many of its counterparts as an anxious market mood kept the safe-haven currency afloat. On Wednesday, the US Dollar faced resistance as there was a modest pullback in US Treasury yields. On Thursday, better-than-forecast US jobless claims supported the ‘Greenback’. Following reports that Israel enacted a drone and missile attack on the Iranian city of Isfahan, escalation in the conflict in the Middle East sapped the market mood, underpinning the safe-haven currency. Pound (GBP) began the week trading mostly flat against the majority of its peers following the publication of the UK’s latest jobs data on Tuesday, which showed a jump in unemployment. In February, the unemployment rate increased to 4.2% from an upwardly revised 4% reading in January. Furthermore, wage growth cooled in the three months leading up to February, with the reading printing at 6%, down from a previous 6.1%. Both figures served to undermined Sterling sentiment on Tuesday on the back of increasing bets that the Bank of England (BoE) will cut interest rates in the summer. On Wednesday, the pound enjoyed some modest support following the publication of latest UK Consumer Price Index (CPI). Both headline and core inflation levels cooled less-than-expected for March’s reading. The pound closed the week firming against the majority of its peers despite the release of underwhelming UK retail sales figures. Looking ahead, the primary driver of movement for the GBP/USD exchange rate this week is likely to be an array of US macroeconomic data. On Tuesday, the US will release its latest S&P Global manufacturing and services PMIs. With both sets of data expected to have slightly ticked up, USD may catch bids early this week. Moving into Wednesday, the latest domestic durable goods orders are forecast to plummet. On Thursday, the latest US GDP data for the first quarter of 2024 is also expected to show a large downturn which may see USD exchange rates weaken. Moving into Friday, the latest core PCE price index is forecast to decrease. Turning to the Pound, a data-light week may mean that Sterling struggles to find a clear trajectory for the majority of the week, which could leave GBP exchange rates vulnerable to the ever-shifting market mood. The only data release of note this week will come in the form of the UK’s latest flash manufacturing and services PMIs for April.
#Pound #Dollar #Gbp/usd #MacroeconomicData #MiddleEastTensions #BankOfEngland #UkJobsData #UkConsumerPriceIndex #UsMacroeconomicData
Euro Under Pressure As ECB Set To Be First To Cut Rates
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The European Central Bank (ECB) is expected to be the first central bank to cut interest rates, putting pressure on the euro. The ECB has strongly hinted at a rate cut in June, and the markets have already priced it in. The Federal Reserve (Fed) and the Bank of England (BoE) are likely to delay their rate cuts, leaving the ECB isolated. The euro's weakness is also influenced by higher oil prices and tensions in the Middle East. The ECB's potential rate cut may be seen as a policy error, eroding trust and pushing euro prices lower. The euro's vulnerability to fluctuations in oil prices is due to the EU's heavy dependence on imports, while the US is energy independent. Despite the expected rate cut, the euro's drop may not be as sustained as it was in 2022, as economic fundamentals are stronger for the euro now compared to then. The Fed is still likely to ease rates this year if there is economic weakness. Overall, the ECB's rate cut decision and other negative catalysts are weighing on the euro's exchange rate.
#Euro #EuropeanCentralBank #InterestRates #RateCut #FederalReserve #BankOfEngland #OilPrices #MiddleEast #PolicyError
Pound To Euro Week Ahead Forecast: One-Month Best To Hold Ahead Of UK Inflation
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The Pound Euro (GBP/EUR) exchange rate traded in a wide range for the majority of last week before ending the week on a positive note, hitting a fresh one-month high. At the time of writing, the GBP/EUR exchange rate traded at around €1.1724, up roughly 0.5% from the start of the week. Euro (EUR) began last week fluctuating as mixed German data left the common currency struggling to catch bids as a large contraction in German exports in February was offset by strong growth in industrial production. On Thursday, EUR exchange rates tumbled in the wake of the European Central Bank (ECB)’s latest interest rate decision. While the central bank left rates unchanged at 4.5% for a sixth consecutive time in April, the accompanying forward guidance stated that lower rates are on the way, which prompted markets to lock in a June rate cut. Pound Sterling (GBP) started the week trading without a clear direction before GBP exchange rates firmed on Tuesday, underpinned by the latest retail sales monitor from the British Retail Consortium (BRC). On Thursday, the Pound enjoyed some modest support following some hawkish observations from (BoE) external monetary policy member Megan Greene. Following the UK’s latest GDP print, where the Office for National Statistics (ONS) confirmed market expectations of a 0.1% increase following January’s upwardly revised 0.3% figure, the pound wobbled despite hopes that the UK is on its way to escaping its winter recession. Looking ahead, the primary driver of movement for the pound euro exchange rate this week is likely to be the release of both the UK’s and the Eurozone’s inflation data for March.
Another Hot Inflation Reading In The US Sends The Dollar Soaring
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Another 0.4% monthly CPI reading has taken headline inflation to 3.5%. A rate cut in June looks unlikely given the Fed’s inflation target is 2%. The US dollar is 0.9% higher and quickly approaching the 2024 high. Yields in the US have broken to new yearly highs, while stocks have dropped sharply. Wednesday’s session had multiple catalysts, from the RBNZ meeting in the Asian session to the BoC meeting after the US open. However, it was the CPI release in the US which really drove global markets as another hot print sent stock markets plunging lower and the US dollar soaring alongside yields. The 10-year yield has now climbed to a 2024 high of 4.5%. Headline CPI was expected to moderate slightly from last month’s 0.4% to 0.3%, which would still have been a worry, but perhaps not enough to change the Fed’s intentions to cut in June. However, Wednesday’s release showed it stayed at 0.4% for the third straight month. This boosted the year-on-year figure to an uncomfortable 3.5%. An annualized reading is way up at 4.8%. This puts the June cut in doubt and sent markets reeling. The Fed have stayed resolutely dovish in front of higher inflation and hot jobs data, but this may well be the final straw and could force them into a more hawkish ‘wait and see’ stance. Hikes are not really an option, but if the current inflationary trend continues or even accelerates, they may be back on the agenda later this year. At the very least, it seems a June cut is likely to be pushed back. Markets had priced in 15bps ahead of the CPI release, but this figure has slipped to just 5bps. ‘Higher for longer’ expectations are back and have sent long-term yields to new 2024 highs. Perhaps surprisingly, the US dollar remains at lower highs with the peaks of both February and early April despite Wednesday's strong move. There was a broad move higher in the underlying components of CPI. Energy costs have increased 1.1% due to the rally in oil, but this was not the only driver. Supercore services (services ex energy, ex housing) rose 0.65%. This was primarily driven by a 0.6% gain in medical care services and a 1.5% increase in transport services. Shelter also rose 0.4%. The only good news was a drop in vehicle prices, recreation prices and airline fares. These are figures the Fed won’t be able to ignore and cutting would be deemed reckless. The question is whether June is still an option if data cools significantly, and if not June, then July? The situation has changed markedly since the start of the year when markets were convinced the Fed would cut six times starting in March. The dollar has climbed higher all year but still has room to the upside and EURUSD could fall further if the ECB meeting on Thursday confirms a cut will happen in June.
#UsInflation #UsDollar #Cpi #Fed #InterestRates
Another Hot Inflation Reading In The US Sends The Dollar Soaring
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Another 0.4% monthly CPI reading has taken headline inflation to 3.5%. A rate cut in June looks unlikely given the Fed’s inflation target is 2%. The US dollar is 0.9% higher and quickly approaching the 2024 high. Yields in the US have broken to new yearly highs, while stocks have dropped sharply. Wednesday’s session had multiple catalysts, from the RBNZ meeting in the Asian session to the BoC meeting after the US open. However, it was the CPI release in the US which really drove global markets as another hot print sent stock markets plunging lower and the US dollar soaring alongside yields. The 10-year yield has now climbed to a 2024 high of 4.5%. Headline CPI was expected to moderate slightly from last month’s 0.4% to 0.3%, which would still have been a worry, but perhaps not enough to change the Fed’s intentions to cut in June. However, Wednesday’s release showed it stayed at 0.4% for the third straight month. This boosted the year-on-year figure to an uncomfortable 3.5%. An annualized reading is way up at 4.8%. This puts the June cut in doubt and sent markets reeling. The Fed have stayed resolutely dovish in front of higher inflation and hot jobs data, but this may well be the final straw and could force them into a more hawkish ‘wait and see’ stance. Hikes are not really an option, but if the current inflationary trend continues or even accelerates, they may be back on the agenda later this year. At the very least, it seems a June cut is likely to be pushed back. Markets had priced in 15bps ahead of the CPI release, but this figure has slipped to just 5bps. ‘Higher for longer’ expectations are back and have sent long-term yields to new 2024 highs. Perhaps surprisingly, the US dollar remains at lower highs with the peaks of both February and early April despite Wednesday's strong move. There was a broad move higher in the underlying components of CPI. Energy costs have increased 1.1% due to the rally in oil, but this was not the only driver. Supercore services (services ex energy, ex housing) rose 0.65%. This was primarily driven by a 0.6% gain in medical care services and a 1.5% increase in transport services. Shelter also rose 0.4%. The only good news was a drop in vehicle prices, recreation prices and airline fares. These are figures the Fed won’t be able to ignore and cutting would be deemed reckless. The question is whether June is still an option if data cools significantly, and if not June, then July? The situation has changed markedly since the start of the year when markets were convinced the Fed would cut six times starting in March. The dollar has climbed higher all year but still has room to the upside and EURUSD could fall further if the ECB meeting on Thursday confirms a cut will happen in June.
#UsInflation #UsDollar #Cpi #Fed #InterestRates
Pound US Dollar (GBP/USD) Exchange Rate Extends Gains On US Inflation Day
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The Pound US Dollar (GBP/USD) exchange rate trended upward on Wednesday as expectations of softening US headline inflation influenced traders’ predictions for central bank policy. At the time of writing, GBP/USD is trading at $1.2698, marginally higher than yesterday’s levels. The US Dollar (USD) encountered volatility on Wednesday as expectations for contradictory inflation data complicated central bank policy forecasts. While headline inflation was expected to have increased on an annualised basis for the month of March, core data was forecast to report a downtrend. The Pound rose against its peers midweek, potentially supported by lingering tailwinds from upbeat retail data on Tuesday. According to the British Retail Consortium (BRC), retail sales in the UK increased by 3.2% in March 2024 on an annualised basis, compared with the 1.8% expected. The Pound US Dollar exchange rate is likely to continue trading according to the outcome of yesterday’s consumer price data, but may also be influenced by producer prices in the US as well as the latest jobless claims release.
#Pound #UsDollar #Gbp/usd #ExchangeRate #Inflation #CentralBankPolicy #RetailSales #ProducerPrices #JoblessClaims
Hot, Sticky US Inflation Print Prompts Pound, Euro Slide Against Dollar
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The US Dollar rallied strongly on Tuesday, buoyed by unexpectedly robust US inflation data, leading markets to dismiss the possibility of a March rate cut. The Euro to Dollar (EUR/USD) exchange rate slumped to 1.0725 from highs fractionally below the 1.0800 level while the Pound to Dollar (GBP/USD) exchange rate dipped sharply to just below 1.2600 from 1.2690 highs posted after the UK jobs data. US consumer prices increased 0.3% for January compared with consensus forecasts of a 0.2% increase. The headline annual inflation rate declined to 3.1% from 3.4%, but above market expectations of 2.9% and failing to dip below the 3.0% level. Core prices increased 0.4% on the month compared with consensus forecasts of 0.3% and the year-on-year rate held at 3.9% compared with expectations of a decline to 3.7%. Following the data, markets priced out any chance of a March rate cut and the chances of a May cut dipped sharply to near 40% from 60% ahead of the data.
#UsDollar #Inflation #ExchangeRates #Euro #Pound #RateCut
US January 2024 Inflation Preview: 0.2% Print Could See Limited Dollar Fall
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Today sees the release of the US CPI Inflation data for January 2024, with predictions from various market analysts. Lloyds Bank forecasts a 0.3% monthly increase in both headline and core CPI, reducing annual rates to 3.0% and 3.8%. SEB expects a potential decrease in January's UK CPI due to dropping used car prices, with core CPI growth at 0.3% monthly. CIBC anticipates that US inflation data won't deter the Fed's easing plans and expects 100 bps cuts in late 2024. ANZ predicts core CPI to decrease to 0.2% m/m in January. Barclays forecasts January core CPI to remain elevated with a 0.3% m/m gain. Credit Agricole predicts a slight decrease in January's US CPI, with headline CPI expected at 0.2% MoM and core CPI maintaining a 0.3% MoM increase. ING forecasts a 0.3% month-on-month core US inflation rate, with risks leaning towards a 0.2% print. The article also includes exchange rate forecasts and other related information.
#UsInflation #UsCpi #ExchangeRates
ECB Balancing Act Sees Euro Return To 2024 Lows Against The Pound
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The European Central Bank (ECB) faces a challenging balancing act in 2024. They must keep policy restrictive to prevent inflation, but are under pressure to cut rates to stimulate the slowing EU economy. The Euro is drifting lower due to poor economic data, suggesting cuts may be needed soon. The US dollar has been strong, but has faded slightly. The Euro has stayed weak, with EURGBP near 2024 lows. ECB board member Isabel Schnabel warned about persistent inflation and the need to contain second-round effects. The EU economy has been stagnant, with Germany in particular facing weakness. The ECB's restrictive rate policy is partly responsible for the weak data. Pressure may mount for the ECB to ease rates when inflation is under control.
#Ecb #Euro #Pound #Inflation #EuEconomy
MUFG Major Currency Forecasts 2024-2025
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MUFG expects the dollar to gradually retreat once the Fed cuts rates and the global outlook improves. EUR/USD is forecasted to strengthen to 1.14 at the end of 2024 with USD/JPY weakening to 134. GBP/USD is expected to strengthen to 1.31 on a 12-month view. Commodity currencies will gain traction once the Fed embarks on an easing cycle. MUFG expects the dollar will gradually lose ground once the Fed starts cutting rates and now expects a first rate cut in May. The bank expects the BoE to cut rates in May or June, leading to a reversal of GBP outperformance. The Euro to Pound (EUR/GBP) exchange rate is forecasted to edge higher to 0.87 by year-end. MUFG expects the RBA to be slow to cut rates, providing support for the AUD before advancing later in the year. The RBNZ is likely to react earlier to cut interest rates given domestic recession risks. MUFG also expects lower Canadian interest rates, with USD/CAD forecasted to drift lower over the second half of the year. The Norwegian and Swedish currencies are expected to make further net headway, but there are important two-sided risks. Tensions in the Middle East are supportive for the price of oil and the Norwegian krone. The Riksbank buying has provided additional support for the Swedish krona, but that is likely to ease soon.
#CurrencyForecasts #Dollar #Fed #Eur/usd #Usd/jpy #Gbp/usd #CommodityCurrencies #Boe #Eur/gbp #Rba #Rbnz #Usd/cad #NorwegianKrone #SwedishKrona
https://www.exchangerates.org.uk/news/40028/2024-02-05-mufg-major-currency-forecasts-2024-2025.html
Pound Sterling Today: US Dollar Firmer Against Its Peers
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The US dollar surged after strong US jobs data, pushing EUR/USD to 8-week lows around 1.0770 and GBP/USD to 1.2615. Fed Chair Powell's comments lowered the likelihood of a March rate cut to around 17%. Monday's focus is on ISM services data and banking sector health. Pound vulnerability remains tied to equity market pressures and BoE commentary on rate cut timelines. Pound to Euro exchange rate (GBP/EUR) is 1.17235 (+0.13%), Pound to Dollar exchange rate (GBP/USD) is 1.2619 (-0.02%). Traders will monitor near-term data for evidence on the overall economy and labor-market trends. The Reserve Bank of Australia is expected to hold interest rates at 4.35%. GBP/USD hit 10-day lows at 1.2600 on Monday. Bank of England chief economist Pill is likely to repeat that it is too early to consider a rate cut.
#UsDollar #PoundSterling #ExchangeRates #EconomicData