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Pound Sterling Exchange Rate Forecast to Trend within Narrow Range against Euro (GBP/EUR), GBP/USD Declines on UK Manufacturing, GBP/CAD Advances

Pound Sterling to Euro (GBP/EUR) Exchange Rate Forecast to Trend within Limited Range despite Greece Missing IMF Payment

The Pound Sterling to Euro (GBP/EUR) exchange rate was trending within a tight range on Wednesday afternoon.

After British manufacturing failed to meet with expected growth, the Pound edged lower versus many of its rivals. The seasonally-adjusted Markit UK Manufacturing PMI was forecast to strengthen from 51.9 to 52.5, but the actual result dropped to 51.4 in June. David Noble, Group Chief Executive Officer at the Chartered Institute of Procurement & Supply said; ‘Manufacturing delivered a sluggish but steady set of results this month compared to more upbeat activity at the start of year, but still remained on terra firma. Supported by domestic demand, purchasing managers reported gentler inflows of new orders and continuing business, as interest from export markets had lost much of its energy.’

The Pound Sterling to Euro (GBP/EUR) exchange rate is currently trending in the region of 1.4093.

The shared currency, meanwhile, softened versus most of its peers after Greece became the first developed nation to defer a payment to the International Monetary Fund (IMF). This has increased the likelihood of a Greek exit considerably. After missing the payment, Athens requested a new two-year bailout programme from the European bailout fund. Euro-area officials will have a teleconference later today to discuss the proposal. There is a very low chance, however, that officials will accept the proposal ahead of the austerity referendum.

The Pound Sterling to Euro (GBP/EUR) exchange rate was trending within the range of 1.4062 – 1.4154.

Pound Sterling to US Dollar (GBP/USD) Exchange Rate Forecast to Decline on Safe-Haven Demand

The Pound Sterling to US Dollar (GBP/USD) exchange rate softened by around -0.46% on Wednesday morning.

The British Financial Stability Report showed that the Bank of England (BoE) were confident that the UK would see little impact from a Greek exit from the Eurozone. Carney’s following speech confirmed this, which saw the Pound recover some of its losses from the less-than-ideal manufacturing data.

The Pound Sterling to US Dollar (GBP/USD) exchange rate is currently trending in the region of 1.5613.

The US Dollar, meanwhile, edged higher versus many of its peers in response to the Greek crisis causing heightened demand for safe-haven assets. The appreciation has been somewhat sluggish, however, after Tuesday’s impressive confidence data was countered by a fall in business conditions. June’s ISM Manufacturing bettered estimates which caused the Dollar to Rally. The improvement of manufacturing and labour market data has caused futures traders to bring forward bets as to the timing of a Federal Reserve benchmark rate increase.

The Pound Sterling to US Dollar (GBP/USD) exchange rate was trending within the range of 1.5646 – 1.5734.

Pound Sterling to Canadian Dollar (GBP/CAD) Exchange Rate Forecast to Advance on Falling Crude Prices

The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate appreciated by around 0.23% on Wednesday afternoon.

Although British manufacturing has caused the Pound to slump versus its peers, the depreciation was somewhat slowed thanks to news that British mining company Sirius has been given the go-ahead to build a large potash mine. The company say that it will create over 1,000 jobs and add $1.6 Billion a year to the UK economy.

The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate is currently trending in the region of 1.9619.

As a risk-correlated currency, the ‘Loonie’ (CAD) softened versus many of its peers in response to the Greek crisis and spooked investors amid uncertainties about the Hellenic nation’s future. In addition, falling oil prices are weighing on demand for the Canadian Dollar. The depreciation in oil can be linked to Greece having defaulted and OPEC production hitting new highs.

The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate was tending within the range of 1.9556 – 1.9662 today.