- Euro flops as industrial production falls – Losses seen for Spain and Italy
- Pound creeps up against rivals – Rates still poor after BoE interest rate cut
- US data brings overall positivity – Surprising rise for NFP figure
The Euro has been an extremely mixed bag of late, having fallen by -0.6% against the US Dollar to 1.10 but risen by 0.7% against the Canadian Dollar to 1.45. Other domestic data out of the single currency bloc has focused on industrial production in June, which has fallen on the year for Spain and Italy.
Germany will be given a chance to redeem itself early on Monday, when the positively-predicted June industrial production result is due.
The Pound has managed a few fleeting recoveries against rivals, though these still remain shadows of pre-BoE rate cut exchange rates. For the UK, the first data of the coming week will be the June balance of trade, which is forecast to show a clear deficit expansion.
The US Dollar has ended the week on a high note, with a higher-than-forecast result for the July change in non-farm payrolls field pushing the ‘Buck’ up across the board.
The ‘Greenback’ could be shifted on Monday afternoon, when the Fed labor market conditions index is announced. This is expected to ‘improve’ from -1.9 to -1.5.
(Last updated August 5th, 2016)
The Euro has been an undesirable option against its peers recently, having slipped in most of its exchange rates in the wake of a worse-than-expected outcome for German factory orders made in June. Other notable Eurozone announcements today will consist of the Greek trade balance result for June, as well as Ireland’s industrial production figures for the same month.
The Pound has still been a weak option for investment of late, with the negative impact of the Bank of England (BoE) interest rate cut still continuing to harm Sterling’s overall performance. Given that no major UK data is due today, it seems highly unlikely that a rallying state will be achieved before trading closes.
The US Dollar has slipped in many of its usual exchange rates, with losses likely being triggered by uncertainty over this afternoon’s change in non-farm payrolls outcome; recent forecasts have been for a positive result that is nonetheless lesser than the previous printing.
(Last updated August 4th, 2016)
The Euro has been an unstable option recently, having slipped against its economic rivals due to implications that future Eurozone growth will not be an easy feat to maintain.
The Pound has fared much worse, however, having been thoroughly devalued against all of its peers by the historic Bank of England (BoE) decision to cut the UK interest rate.
The US Dollar completes the hat trick of undesirable currencies, having lost out on notably lowered odds of a US interest rate hike taking place in September.
Eurozone News: Euro Exchange Rates Softened by ECB Bulletin’s Harsh Wording
The Euro’s performance of late has been poor, with Thursday seeing Ireland’s services PMI for July fall along with the Greek unemployment rate for May remaining at 23.5% instead of falling as expected.
One of the biggest blows to the value of the Euro came yesterday morning, when the European Central Bank (ECB) bulletin came out for August.
While most of this was standard fare, the overall message from the bulletin was that the Eurozone had to contend with low growth, high debt and an overall slowdown before the single currency bloc could return to its former stable state.
Pound Sterling Rates Dive on BoE Rate Cut, US Dollar Dips as Fed Rate Hike Odds Fall
This was brought about in response to the ‘Brexit’ decision and subsequent economic activity crash; BoE Governor Mark Carney has made a number of comments in the wake of the historic decision.
In addition to voicing his dislike of the concept of ‘helicopter money’, Carney also stated that another rate cut (to 0%) could take place, but that negative interest rates were also an unlikely eventuality. Commenting on conditions for savers, Carney pessimistically stated;
‘Saving rates are probably going to be low for some time, both in the UK and beyond’.
The US Dollar has failed to break out into a rallying state recently, with the Fed interest rate decision remaining a thorn in the side of investor expectations.
While Fed official Robert Kaplan was looking forward to a September rate hike earlier in the week, he has since focused his attention on concerns of slowing growth in China.
The performance of the Chinese economy is often used as an indicator of how likely the Fed is to hike the US interest rate, therefore worrying signs in China translate directly to greater concerns that September will bring yet another rate freeze.
Future EUR GBP USD Forecast: Could US NF-Payrolls Pull Through for US Economy?
The next domestic data to watch out for will come from the Eurozone, when Germany releases its optimistically-forecast factory orders data for June. Also out from the Eurozone will be Greece’s June trade balance, which could see a reduction in the current deficit.
The UK’s contributions will be minimal, consisting of July’s Halifax house price index results.
From the US, however, will be a trio of major releases, starting with the June trade balance; this has a reduction in the current deficit forecast.
Out at the same time will be the non-farm payrolls result for July, as well as the unemployment rate for the same month.
Payrolls have a shift from 287k to 190k forecast, while unemployment is not expected to change from 4.9%.
Recent EUR, GBP, USD Exchange Rates
The Euro Pound (EUR GBP) exchange rate has been trending in the region of 0.8475 and the Pound Euro (GBP EUR) exchange rate has been trending in the region of 1.1801 recently.
The Euro US Dollar (EUR USD) exchange rate has been trending in the region of 1.1133 and the US Dollar Euro (USD EUR) exchange rate has been trending in the region of 0.8984 recently.
The Pound US Dollar (GBP USD) exchange rate has been trending in the region of 1.3139 and the US Dollar Pound (USD GBP) exchange rate has been trending in the region of 0.7613 recently.