Best Exchange Rates

GBP Exchange Rates Climb on UK Service Sector Growth

Categories: AUD, CAD, EUR, GBP, Markets, News, NZD, USD

UK Domestic Data Proves Positive, Pound (GBP) Exchange Rates Bolstered

Pound Sterling (GBP) inched ahead against the majors on Thursday, propelled by a run of positive UK ecostats.

The most pertinent out of these releases was perhaps the UK Markit services purchasing managers index (PMI), which expanded to 54.2 in December, up from the forecast of 54 and the previous period’s print of 53.8.

This marked the second-highest reading since April, with rising consumer spending largely boosting business activity.

Conversely, Brexit-related uncertainty continued to hold back clients’ openness to spending, though business optimism, surprisingly, climbed to a 7-month high, bolstered by new product launches and hopes for stronger demand amid better global economic conditions.

So what does this mean for Sterling?

The service sector makes up almost 80% of the UK’s economy, so any growth here – especially above forecast growth – reflects positively on the UK, and indeed the Pound.

GBP EUR Exchange Rate Steady as Eurozone Companies Post Strongest Growth Since 2011

The Pound Euro (GBP EUR) exchange rate remained predominantly steady on Thursday morning, limited by a run of positive domestic data releases from the bloc.

The Eurozone’s composite PMI – a measure of activity across the region – climbed to 58.1 in December, beating November’s 57.5 reading.

Meanwhile, the service sector inched up from 56.2 to 56.6, with new orders strengthening and manufacturers claiming the sharpest increase in new business since 2000.

This rounded off the Eurozone’s best year in over a decade, confounding fears that political uncertainty might curb growth within the bloc.

GBP USD Exchange Rate Climbs Amid Mixed FOMC Meeting Minutes

The Pound US Dollar (GBP USD) exchange rate rallied on Thursday, lifted by the UK’s upbeat services PMI as well as the mention of ongoing inflation concerns in the December FOMC meeting minutes.

The Fed voted to increase its benchmark interest rate to 1.5% at the meeting, and generally had an upbeat outlook on the future of the US economy.

The minutes stated:

‘Real economic activity appeared to be growing at a solid pace, buttressed by gains in consumer and business spending, supportive financial conditions, and an improving global economy’.

The minutes also pointed to soft inflation levels, although the majority of officials ‘judged that much of the softness in core inflation this year reflected transitory factors and that inflation would begin to rise as the influence of these factors waned’.

Looking ahead, today will feature the release of US employment figures as well as the US composite PMI reading for December; two events that could knock the Pound US Dollar exchange rate either way.

GBP CAD Exchange Rate Stable Today Despite Crude Oil Surge

Despite the ongoing surge in crude oil prices the GBP CAD exchange rate remained mostly stable on Thursday, buoyed by the latest run of UK ecostats and the recent volatility of the US Dollar.

Markets will, however, be looking to today’s Canadian raw material prices figures as well as the industrial product price index (PPI) readings for November for further insight into the Canadian economy.

Looking further ahead, the Bank of Canada (BOC) recently published a report warning that raising the minimum wage in Canada could result in the loss of some 60,000 jobs.

This is all the more relevant in that a large number of Canada’s regions are soon set to raise the minimum income rate by the end of 2018 – an eventuality that would make it harder for employers (particularly at small-time businesses) to afford to pay salaries, thus reducing business investment and development.

Rise in Iron Ore Prices Limits Pound Australian Dollar (GBP AUD) Exchange Rate

The Pound Australian Dollar (GBP AUD) exchange rate failed to fully capitalise on the UK’s upbeat services PMI on Thursday, limited by a prolonged rise in iron ore spot markets and the relative weakness of the US Dollar (USD)

In other news, the recent prediction from HSBC Australia that a rate hike from the Reserve Bank of Australia (RBA) could be due in mid-2018 continues to limit the GBP AUD pairing. Wednesday’s AiG performance of service index figure for December also rose to 52.0 from 51.7, keeping the ‘Aussie’ Dollar on good form.

Surging Dairy Prices and Upbeat Chinese Data Leaves the GBP NZD Exchange Rate Stumbling

The GBP NZD exchange rate extended its fall on Thursday morning, limited by ‘Kiwi’ Dollar bulls deriving support from China’s upbeat Caixin December PMI release, and the recent surge in global dairy prices.

Chinese service activity experienced an upturn in December, climbing to 53.9 from 51.9 and beating the forecast of a drop to 51.8.

This is pertinent in that China is one of New Zealand’s top trading partners.

Please note that the opinions of our authors are their own and do not reflect the opinion of Best Exchange Rates and should not be taken as a reference to buy or sell any financial product. Full Disclaimer

BER Newsletter

Subscribe for the latest exchange rates, currency news and special offers directly to your inbox.

Best Exchange Rates - We make it Easy to Compare Exchange Rates & Fees of Banks and Currency Exchange & Payment Providers


Level 2, AMP Tower, 50 Bridge Street, Sydney, NSW 2000, Australia

Disclaimer | Copyright | Privacy Statement


DISCLAIMER

Best Exchange Rates is an information only service. By browsing on the website, using our comparison tools or FX provider referral service, you are asking Best Exchange Rates to provide you with information about currency exchange products & services from multiple financial institutions.

We will try to show you a range of products & services in response to your request for information. The search results do not include all providers and may not compare all features relevant to you. In giving you product information we are not making any suggestion or recommendation to you about a particular product.

If you decide to conduct foreign exchange you will deal directly with a financial institution, and not with Best Exchange Rates. Rates and product information should be confirmed with the relevant financial institution, see our terms of use for further details.

Best Exchange Rates may receive fees or other benefits in relation to activity on the Best Exchange Rates website. Best Exchange Rates may receive remuneration for vendor referral links. Please note that the opinions of our authors are their own and do not reflect the opinion of Best Exchange Rates and should not be taken as a reference to buy or sell any financial product.

Read our Full Terms of Service



COPYRIGHT

This website and its contents are the copyright of BEST EXCHANGE RATES PTY LTD © 2009-17. All rights reserved.

Any redistribution or reproduction of part or all of the contents in any form is prohibited other than the following. You may print or download contents to a local hard disk for your personal and non-commercial use only. You may copy some extracts only to individual third parties for their personal use, but only if you acknowledge the website as the source of the material.

You may not, except with our express written permission, distribute or commercially exploit the content. You may not transmit it or store it on any other website or other form of electronic retrieval system.

For more details or request distribution right please contacxt us here.