- Pound battered over day’s trading – Little positive emerges from UK
- Euro upticks against softened peers – Overall trade balances still in deficit
- US Dollar crumbles after latest data – Wholesale inventories disappointingly rise
The Pound has been in the pits today, with no actual good news being announced to begin a potential recovery. In addition to suffering from the threat of further interest rate cuts, the UK currency has also been battered by continuing Southern rail strikes and fresh ones from Virgin East employees.
The Euro has risen against the weak Pound and US Dollar, though mainly due to converse deteriorations in value. After a positive German trade balance result for June, the other Eurozone results in this field have mainly remained in damaging deficit areas.
The US Dollar has flopped on recent ecostats, which have consisted of the rising wholesale inventories result for June and the marginally improved NFIB business optimism index for July.
The next relevant data will come from the Eurozone, when the annual June industrial production results for France and Finland (among others) are announced.
(Last updated August 9th, 2016)
Sterling (GBP) continues to fare poorly against the Euro (EUR) and US Dollar (USD) as the week progresses, with losses consisting of -0.2% and -0.3% respectively. Against this negative display, BRC like-for-like sales on the year in July have actually risen from -0.5% to 1.1%. The next UK data is due to come shortly, in the form of positively-predicted June industrial and manufacturing production stats.
The Euro has crept up in exchange rates, thanks in no small part to Germany’s rising trade surplus in June.
The US Dollar has remained in relatively high demand, on account of the continued positive influence of yesterday afternoon’s labour market conditions index change.
As it stands, the Pound Euro (GBP/EUR) exchange rate is trading in the region of 1.1706 while the Pound US Dollar exchange rate is trading in the region of 1.2977.
(Last updated August 8th, 2016)
The Pound has remained soft against its peers recently, owing to no signs of a quick solution to the current five-day strike on the Southern rail network.
The US Dollar has been a mixed bet as well, although a move into positive territory for the Fed labour market conditions index for July has bolstered confidence in the US currency.
The Euro’s mixed day has failed to see the erosion of prior gains, with a 0.2% result for harmonised Greek annual inflation in July coming against forecasts of a dip to -0.1%.
The next data for the UK and the Eurozone remains trade based; economists have been speculating that a smaller-than-forecast expansion in the current UK trade deficit could limit losses for the Pound against the Euro and US Dollar.
(Last updated August 8th, 2016)
The Pound has started off the week on a low note, having been continuously devalued by last week’s Bank of England (BoE) interest rate cut.
The Euro has been the strongest of the three currencies, having been pushed up by positive opening data.
The US Dollar has been harmed at the start of the week by bad news out of China, which has put a Fed interest rate hike into question.
UK Economic News: Pound Exchange Rate Devaluation comes after Historic BoE Rate Cut
The Pound has opened the week in an undesirable state, having fallen against many of its competitors due to an absence of data as well as a continued negative influence from last week’s BoE news.
The salient point was that for the first time in over seven years, the BoE cut the UK interest rate from 0.5% to 0.25%, the lowest rate ever seen since the bank’s inception in the 17th century.
This was ostensibly due to ‘Brexit’ pressures, which have seen the UK economy slow and fall into contraction in the first month since the EU Referendum outcome in late June.
Pound losses today have consisted of minor declines against the Euro (GBP EUR) and the US Dollar (GBP USD), as well as greater drops of -0.4% against the Israeli New Shekel (GBP ILS) and -1% against the Mexican Peso (GBP MXN).
Euro Climbs on Eurozone Data while US Dollar Flops after Chinese Trade Results
The Euro has made a number of healthy gains against its peers recently, having been boosted by better-than-expected data at the beginning of the week.
This has consisted of a rising Irish construction PMI for July, increasing Dutch manufacturing production in June and a better-than-expected result for German industrial production in July.
The Euro has risen by a marginal amount against the US Dollar (EUR USD) and by 0.2% against the Pound (EUR GBP).
The US Dollar has opened trading poorly, having slipped against the Euro (USD EUR) and only managed a narrow advance against the Pound (USD GBP). In other pairings, the US currency has been decidedly mixed.
The latest bad news to hit the US has concerned Chinese trade in July, which has fallen on the year. While not directly linked to the US, this news has nonetheless lowered expectations of a near-term Fed interest rate hike by a small amount.
Responding to the news, Angus Nicholson, an Analyst at IG, said:
‘I definitely think we could see concern over the surplus. We have a long way to go before we really see a decline in China’s overcapacity’.
Future GBP EUR USD Forecast: UK and German Trade Stats out Tomorrow, Negativity Predicted
The next data to watch out for from the UK, Eurozone and US will be sourced from the UK, where the nation’s June trade deficit for June is expected to fall in data released tomorrow morning.
In addition, Germany’s trade surplus for the same month also has a loss forecast.
The first notable US data is expected tomorrow afternoon, when the June wholesale inventories figures will be announced.
Current GBP, EUR, USD Exchange Rates
The Pound Euro (GBP EUR) exchange rate was trending in the region of 1.1754 and the Euro Pound (EUR GBP) exchange rate was trending in the region of 0.8508 today.
The Pound US Dollar (GBP USD) exchange rate was trending in the region of 1.3037 and the US Dollar Pound (USD GBP) exchange rate was trending in the region of 0.7671 today.
The Euro US Dollar (EUR USD) exchange rate was trending in the region of 1.1091 and the US Dollar Euro (USD EUR) exchange rate was trending in the region of 0.9019 today.