Pound Sterling (GBP) Exchange Rate Woes Exacerbated by Brexit Fears
The Pound (GBP) had a difficult end to Friday’s session as Brexit re-entered the limelight, seeing Sterling exchange rates show signs of a downturn.
Following the continuation of Brexit talks on Thursday, Danish Finance Minister Kristian Jensen expressed concerns that the UK might not strike a deal in time, weakening confidence in GBP.
The Pound may struggle to gain traction this week, with no significant data releases scheduled for the coming days, leaving Brexit developments to drive Sterling.
GBP/EUR Exchange Rate Declines as Euro Capitalises on USD Losses
The Pound Euro (GBP/EUR) exchange rate fell towards the end of last week’s session with investors turning to the Euro as the US Dollar (USD) dipped.
The single currency was unable to wholly exploit the ‘Greenback’s’ ill-fortune, however, with another downturn in the Turkish Lira (TRY) again sparking concerns of a domino effect on Eurozone economies.
Looking ahead, today’s Eurozone construction output data could see EUR make some gains if the figure increases by 4.5% as forecast.
GBP/USD Exchange Rate Rallies as Trade Tensions Ease
The Pound US Dollar (GBP/USD) exchange rate increased by half a cent on Friday, allowing the Pound to make up a little lost ground, but not enough to propel Sterling much higher than a 14-month low.
This rise in the exchange rate came after trade fears cooled following news that the US and China would meet for trade talks, which lessened demand for safe haven currencies like the ‘Greenback’.
USD may rise again later this week, however, should markets price in further rate hikes following a positive Federal Reserve policy meeting.
GBP/CAD Exchange Rate Plummets following Soar in Canadian Inflation
The Pound Canadian Dollar (GBP/CAD) exchange rate toppled on Friday despite showing signs of recuperating since Wednesday from its lowest rate in over a year.
This drop in the exchange rate came after Canada’s latest CPI data was released, which showed that domestic inflation increased to 3% from the previous 2.5%, sparking hopes that inflation rates would follow suit.
The pairing may remain trading in a relatively tight range this week, with a lack of key Canadian data releases likely to see the ‘Loonie’ stall, barring any major fluctuations in oil prices.
GBP/AUD Exchange Rate Dips following Trade Positivity
The Pound Australian Dollar (GBP/AUD) exchange rate declined on Friday on news that the US and China would engage in trade talks, which investors hope might aid the nations in finding a resolution to the ongoing trade spat.
Nevertheless, the ‘Aussie’ may struggle to maintain momentum at the commencement of tomorrow’s Australian session, with the Reserve Bank of Australia’s (RBA) latest policy meeting minutes expected to present a dovish stance from the central bank.
GBP/NZD Exchange Rate Declines as Risk-Appetite Surges
The Pound New Zealand Dollar (GBP/NZD) exchange rate followed GBP/AUD’s example on Friday, as investors embraced more risk-related currencies as optimism regarding upcoming US-China trade talks abounded.
The ‘Kiwi’ may dip tomorrow though, with economists forecasting another consecutive dip in prices at the Global Dairy Auction.
The threat of a proxy war between the US and Iran in Iraq has pared back some of the recent gains of “risk-on” currencies.
Last update: 8 Jan, 2020
Both the Australian dollar and British pound sterling have had a hard time of late caught between the rock of the China/US trade war and the Brexit hard place.
Last update: 7 Jan, 2020
The RBA has cut Australian interest rates to a record low of 1 percent in an effort to boost inflation. The Australian dollar is slightly stronger following the widely expected decision but is expected to lose 5–7 percent of its value before year-end.
Last update: 7 Jan, 2020