Newsflash: Pound Gains on Euro, Falls against US Dollar
Following the publication of the UK’s Construction Output data, the Pound held a previous modest decline against the ‘Greenback’ and consolidated gains against the Euro.
Sterling was able to advance on the common currency as it was announced that Greece is in talks to privatise the nation’s largest port in an attempt to drum up some much-needed funds.
The Greek Finance Minister also asserted that the indebted nation wont be making upcoming repayments to the European Central Bank (ECB) later in the summer.
Declines against the US Dollar were accrued as investors looked ahead to today’s US reports and bet that Industrial and Manufacturing Production would show improvement.
The UK’s Construction Output report showed a monthly gain of 3.9% in March and an annual increase of 1.6%.
While the yearly figure was above forecasts, the month-on-month figure fell slightly short.
The Pound Sterling to Euro (GBP/EUR) exchange rate was trading in the region of 1.3862
The Pound Sterling to US Dollar (GBP/USD) exchange rate was trending in the region of 1.5752
Newsflash: US Initial Jobless Claims Decline, Pound Fails to Hold 1.58
Before the release of the US initial jobless claims numbers, the Pound Sterling to US Dollar (GBP/USD) exchange rate briefly advanced to a high of 1.5815.
However, with the number of people applying for first time unemployment benefits in the US unexpectedly falling in the week ending May 9th, the Pound was unable to continue trending above this level.
Initial jobless claims printed at 264K instead of the 273K expected while the four-week moving average came in at a 15-year low.
Industry expert Raymond Stone said of the result; ‘Labour-market conditions are quite firm. Typically, when you have low claims you have strong payroll numbers.’
Tomorrow’s UK Construction Output data could have an impact on the GBP/EUR, GBP/USD exchange rates.
The Pound Sterling to Euro (GBP/EUR) exchange rate was trading in the region of 1.3835
The Pound Sterling to US Dollar (GBP/USD) exchange rate was trending in the region of 1.5792
Newsflash: Pound Sterling to US Dollar (GBP/USD) Exchange Rate Hits 1.58
Before the release of the US initial jobless/continuing claims figures the Pound Sterling (GBP/USD) exchange rate extended its daily gain and briefly hit a high of 1.5812.
‘Cable’ could hold above this level if applications for unemployment benefits exceed expectations.
The Pound Sterling to Euro (GBP/EUR) exchange rate held its -0.25% decline to trade in the region of 1.3831
Wednesday’s dovish Inflation report from the Bank of England (BoE) left the Pound Sterling to Euro (GBP/EUR) exchange rate trending in the region of 1.38, but the Pound Sterling to US Dollar (GBP/USD) exchange rate managed to hold its strongest level of 2015 so far on US retail sales news.
Pound Sterling to Euro (GBP/EUR), Pound Sterling to US Dollar (GBP/USD) Exchange Rate News – UK Unemployment Hits 7-Year Low but BoE Dovish on UK Growth Outlook
The Pound experienced something of a rollercoaster of movement on Wednesday, with the Pound Sterling to Euro (GBP/EUR) exchange rate plunging from 1.40 to 1.38 and the Pound Sterling to US Dollar (GBP/USD) currency pair advancing to within touching distance of 1.58.
Early in the European session Sterling posted impressive gains against both the Euro and US Dollar as the UK published encouraging employment data.
The Pound Sterling to Euro (GBP/EUR) exchange rate hit a low of 1.3802
The nation’s unemployment rate was shown to have fallen to a seven-year low of 5.5% while average earnings increased by more-than-expected.
Conservative Work and Pensions Minister Priti Patel said of the result; ‘This is a testament to our long-term economic plan, the work the government has been doing with our focus on job creation, creating the right economic conditions for businesses to expand and grow so they can employ people again, so this is very welcome news today.’
The Pound Sterling to US Dollar (GBP/USD) exchange rate hit a high of 1.5789
However, the Pound’s gains against the Euro proved short-lived and the GBP/EUR exchange rate stumbled after the Bank of England (BoE) delivered its Inflation Report.
As a fairly hawkish statement had been expected, the central bank’s warnings regarding the strength of the domestic currency and the negative revisions to growth projections were badly received by investors.
The Pound fell against the Euro, US Dollar, Australian Dollar and New Zealand Dollar following the report’s publication.
As stated by The Financial Times; ‘Forecasting that inflation would remain close to zero before rising towards the end of this year to move back to its 2% target, the BoE suggested interest rates were likely to rise for the first time in the middle of 2016 and continue on a gradual path higher to about 1.5% in three years’ time. George Osborne, chancellor, will be disappointed the BoE has downgraded its forecast, but the change brings the BoE outlook more into line with other forecasters, including the Office for Budget Responsibility.’
Pound Sterling to Euro (GBP/EUR) Exchange Rate Forecast – Eurozone Growth, German Inflation Data Lends the Euro Support
The downtrend in the Pound Sterling to Euro (GBP/EUR) exchange rate was also due to the Eurozone publishing a mixed bag of economic data.
The region’s Industrial Production figures may have been disappointing, but this was more than made up for by a solid growth figure for the first quarter and positively revised inflation data for Germany, the Eurozone’s largest economy.
Although both Greece and Finland entered recession in the first three months of the year, the French economy exceeded expectations by expanding at a quarterly rate of 0.6% and Italy matched the UK with growth of 0.3%.
Meanwhile, Germany’s Consumer Price Index was upgraded from 0.4% on the year in April to 0.5% – another sign that the extensive quantitative easing measures deployed by the ECB are having the desired effect.
With ecostats for the Eurozone in short supply today, any further GBP/EUR movement will be the result of developments in the Greek bailout negotiations.
Pound Sterling to US Dollar (GBP/USD) Exchange Rate News – US Retail Sales Flop Drives ‘Cable’ to New 2015 Highs, Fed Interest Rate Bets Pushed Back
‘Cable’ did dip in response to the BoE’s inflation report, but the Pound Sterling to US Dollar (GBP/USD) exchange rate swiftly recovered losses as economists reacted to the latest Advance Retail Sales report for the US.
Retail sales had been forecast to climb by 0.2%, but they actually stagnated in April.
The lacklustre report drove the US Dollar lower against a number of its most-traded currency counterparts as it was seen to provide yet another reason why the Federal Reserve should delay increasing interest rates.
Pound Sterling to Euro (GBP/EUR) and Pound Sterling to US Dollar (GBP/USD) Exchange Rate Forecast: ‘Cable’ Could Achieve 1.58 if US Jobless Claims Increase
Later today the US will be publishing initial jobless/continuing claims numbers.
Economists have forecast an increase in the number of people applying for first time unemployment benefits in the week ending May 9th. The number of continuing claims issued is also expected to rise.
If that proves to be the case, the GBP/USD exchange rate has the potential to advance all the way to the 1.58 level ahead of tomorrow’s US Manufacturing/Industrial Production and Confidence data.
The Euro to Pound Sterling (EUR/GBP) exchange rate was trading in the region of 0.7239, the Pound Sterling to US Dollar (GBP/USD) exchange rate was trending in the region of 1.5768, the US Dollar to Pound Sterling (USD/GBP) exchange rate was trading in the region of 0.6341, the Pound Sterling to Euro (GBP/EUR) exchange rate was trending in the region of 1.3814