Disappointing UK Jobs Data Pushes Pound Sterling (GBP) Lower
The Pound Sterling to Euro (GBP/EUR) exchange rate fell from above the 1.42 level to 1.4143 as investors responded to the UK’s slightly disappointing batch of employment figures.
The nation’s unemployment rate unexpectedly increased from 5.5% to 5.6% as the UK lost -67,000 positions instead of adding the 35,000 expected.
Average earnings both including and excluding bonuses failed to increase as much as expected.
The GBP/EUR pairing dipped and the GBP/USD exchange rate eased from a high of 1.5675.
The fact that the pace of wage growth was still close to a five-year high did see the Pound go on to recover losses before the close of trading.
Carney Hints at 2016 Q1 Interest Rate Revisions, GBP/EUR, GBP/USD Exchange Rates Jump
As the European session continued the Pound rallied across the board in response to some provocative comments from Bank of England (BoE) Governor Mark Carney.
Carney indicated that he expects inflation to pick up at the beginning of 2016 and for the UK to be ready for higher borrowing costs in the first quarter.
The remarks saw Starling jump by over 1% against the Canadian Dollar and more than 0.7% against both the US Dollar and New Zealand Dollar.
The Pound consolidated gains against the US Dollar following the publication of disappointing US retail sales numbers. Sales were shown to have contracted by -0.3% in June following a negatively revised gain of 1.0% in May.
The Pound Sterling to Euro (GBP/EUR) exchange rate was trending in the region of 1.4127 after hitting a high of 1.4140
The Pound Sterling to US Dollar (GBP/USD) exchange rate was trending in the region of 1.5588 after hitting a high of 1.5603
Both the Pound Sterling to Euro and (GBP/EUR) and Pound Sterling to US Dollar (GBP/USD) exchange rates could recoup today’s losses if tomorrow’s UK employment data shows an increase in average earnings.
Pound Sterling to Euro, Pound Sterling to US Dollar Exchange Rate News: GBP/EUR Moves from Best Rate of 1.41, GBP/USD Trends Below 1.55 as UK Inflation Slows, Grexit Speculation Persists
The Pound Sterling to Euro (GBP/EUR) exchange rate came within touching distance of the 1.41 level against the Euro on Monday as investors bet Greek PM Alexis Tsipras will struggle to get a series of harsh austerity proposals through parliament in time to secure a third bailout.
The Pound Sterling to Euro (GBP/EUR) exchange rate hit a high of 1.4096
Uncertainty surrounding the Greek situation also inspired US Dollar fluctuations, with the GBP/USD exchange rate climbing above 1.55 amid hopes that Greece will stay in the Eurozone and improve the UK’s trade prospects.
However, the Pound fell back to 1.54 against the US Dollar and lost -0.3% against the Euro as the UK’s Consumer Price Index for June showed a decline in annual inflation from 0.1% to 0.0%.
The data saw a representative from the Office for National Statistics observe; ‘Inflation has continued its pattern of recent months, when prices have been very little changed on the previous year. The headline rate for June has dropped very slightly on May, back to Zero, thanks to small downwards effects from movements in clothing and food prices and air fares.’
The Pound Sterling to US Dollar (GBP/USD) exchange rate achieved a high of 1.5494
Euro to Pound Sterling (EUR/GBP) Exchange Rate Forecast – German Inflation at 0.3%, ZEW Surveys Fall, Eurozone Industrial Production Flops Today
Although the situation in Greece has been the main cause of Euro movement for the past couple of weeks, ecostats for the Eurozone and its largest economies are having a modest impact on trading.
This morning Germany’s Consumer Price Index printed at -0.1% on the month and 0.3% on the year, as previously estimated.
A separate report showed that Industrial Production in the currency bloc fell -0.4% month-on-month (rather than climbing the 0.2% expected) which dragged the annual figure from 2.0% to 1.6%.
It wasn’t all bad news for the Eurozone today however, as the German ZEW Current Situation Survey for July actually advanced from 62.9 to 63.9 instead of slipping back to 60.0.
The nation’s Economic Sentiment Index also fell by less-than-predicted, although Economic Sentiment in the Eurozone as a whole dropped from 53.7 to 42.7.
The Euro to Pound Sterling (EUR/GBP) exchange rate fell to a low of 0.7090
US Dollar to Pound Sterling (USD/GBP) Exchange Rate Forecast – ‘Cable’ Could Resume Uptrend Towards 2015 Best Rate if US Retail Sales, CPI Data Push Back Fed Interest Rate Hike Expectations
The prospect of the Federal Reserve increasing interest rates this year has been dangled in front of investors like a carrot on a stick for months but the odds of a 2015 adjustment taking place are fluctuating constantly.
While Fed officials have offered conflicting viewpoints regarding the timeline for any revisions, most have indicated that moves will be data dependent.
Therefore, if this week’s main US reports (today’s Advance Retail Sales and Friday’s Consumer Price Index) print positively, Fed rate bets will improve and the US Dollar will climb.
The US Dollar to Pound Sterling (USD/GBP) exchange rate fell to a low of 0.6452
Pound Sterling to Euro (GBP/EUR) and Pound Sterling to US Dollar (GBP/USD) Exchange Rate Forecast: UK Employment/Average Earnings Data, Greek Decision and Eurozone Inflation, ECB Announcement Ahead
While today’s US Advance Retail Sales report is likely to have an impact on Pound Sterling to US Dollar (GBP/USD) exchange rate trading, investors with an interest in the pairing will also be looking ahead to tomorrow and the publication of the UK’s June employment numbers.
Economists have forecast that the nation added 35,000 positions in the three months through May, which would leave the unemployment rate at a multi-year low of 5.5%.
However, Average Earnings is the figure investors are really interested in. If wages have risen in the period, as is expected to be the case, the Pound could recoup today’s losses and trend higher across the board.
The GBP/EUR exchange rate will also experience volatility as the Greek parliament votes on whether or not to accept the harsh austerity measures put forward by creditors.
Other news with the potential to trigger GBP/EUR and GBP/USD exchange rate movement includes the Eurozone’s final inflation figures for June, the European Central Bank’s (ECB) interest rate decision and the US Consumer Price Index.
All in all, the rest of the week is looking pretty eventful.
The Euro to Pound Sterling (EUR/GBP) exchange rate was trading in the region of 0.7108, the Pound Sterling to US Dollar (GBP/USD) exchange rate was trending in the region of 1.5497, the US Dollar to Pound Sterling (USD/GBP) exchange rate was trading in the region of 0.6453, the Pound Sterling to Euro (GBP/EUR) exchange rate was trending in the region of 1.4049