Pound Sterling exchange rates have been unsettled across the board today, reflecting the widespread uncertainty about Bank of England (BoE) Governor Mark Carney’s future.
- Pound mixed as debate rages about BoE’s Carney – Will Governor stay or go?
- Euro softened by dismal German retail results – Eurozone superpower remains in question
- US Dollar weakened by fresh election shock – Polls put Clinton-Trump neck and neck
- Key UK PMIs due before BoE rate decision – US income data due along with PMI news today
The Euro has been in low demand after some disappointing German retail sales stats, while the US Dollar has been able to make minor gains despite the latest scandal emerging from the US election.
Pound Sterling Exchange Rate News: GBP Demand Wanes amid Carney Speculation Storm
The Pound has traded at the low end of 1.11 against the Euro (GBP EUR) today and stabilised at 1.21 against the US Dollar (GBP USD).
The latest damage to Sterling has been dealt by widespread speculation over the weekend about Bank of England (BoE) Governor Mark Carney, whose future in the wake of Brexit has come into question.
While critics and defenders have been vocal so far, the BoE itself has simply issued a statement that;
‘The Governor has said he will make his decision public by the end of the year’.
Should Carney leave under pressure from Brexiteers, the Pound is expected to plummet, given that the best conditions for currency stability are solid and consistent leadership.
Euro and US Dollar Trading Limited by Sales Stats and Election Upset
For the Euro, demand has been low in most cases, owing to Germany’s September retail sales results dropping alarmingly from 3.8% to 0.4% on the year and from -0.3% to -1.4% on the month. Prior German data had been comparatively more positive.
While Spain has posted some more positive sales results during the same month, this has failed to inspire any lasting EUR confidence.
The start of last week may well have had a Clinton election victory as a near-certainty. However, the news that the FBI is investigating further emails from the Democratic candidate has put this outcome into doubt.
While questions have been raised about the timing and legality of the intelligence agency’s announcement, the dredging up of the former Clinton scandal has regardless weakened her chances of victory, especially given the slump in polling figures seen in the aftermath.
The US Dollar has been softened considerably by this news, as it could mean that the more radical Republican option, Donald Trump, still has a shot at claiming the Oval Office in just over a week’s time.
Future GBP EUR USD Forecast: High GBP Volatility Likely on Incoming PMI Printings
The next key UK announcements will come over Tuesday to Thursday, covering October’s manufacturing, construction and services PMIs, respectively.
Pound-damaging declines have been forecast in all cases, though not into the sub-50 contraction range. Thursday will also bring the next BoE interest rate decision and press conference, where any comments from Carney about his future intentions are sure to generate high volatility for Sterling.
The next Eurozone news will be fairly low-impact, covering Greece’s October manufacturing PMI (which is expected to decline), as well as Spain’s pessimistically-predicted new car sales.
For the US, this afternoon will bring key personal income and spending results for September, as well as the Chicago PMI for October. Spending is expected to rise, while the PMI has a slight drop forecast from 54.2 to 52.2.
Current Interbank Exchange Rates
The Pound Euro (GBP EUR) exchange rate was trending in the region of 1.11 and the Euro Pound (EUR GBP) exchange rate was trending in the region of 0.89 today.
The Pound US Dollar (GBP USD) exchange rate was trending in the region of 1.21 and the US Dollar Pound (USD GBP) exchange rate was trending in the region of 0.82 today.
The Euro US Dollar (EUR USD) exchange rate was trending in the region of 1.09 and the US Dollar Euro (USD EUR) exchange rate was trending in the region of 0.91 today.