April UK House Price Rise Gives Hope for Post-Brexit Economy – GBP Exchange Rates Trade Higher
Sterling traded higher against the majors on Monday, supported by news that UK house prices edged past record numbers in April, and on general optimism about this week’s significant labour market and inflation statistics.
Asking prices for newly-listed properties in the UK climbed to a national average of £305,732 in April according to Rightmove, easing slightly from the 1.5% growth recorded in March but still nudging the national average asking price to a record high.
This news helped further dispel concerns that the Brexit process might cause a crash in the housing sector, boding well for the UK’s economy and giving a lift to the Pound.
GBP/EUR Exchange Rate up on Quiet Data Day – Eurozone Inflation in the Spotlight
The Pound Euro (GBP/EUR) exchange rate traded slightly higher this morning, unperturbed by today’s quiet data calendar and gaining on last week’s rather poor ecostats from the bloc.
Investors will be keeping a keen eye on this week’s Eurozone consumer price inflation results (due on Wednesday), with a rise forecast from 0.2% to 1.0% in March (month-on-month) and 1.1% to 1.4% year-on-year.
This result would be good for the European Central Bank (ECB), especially with ECB Policymaker Ewald Nowotny claiming last week that the bank’s substantial bond-purchasing programme could end before 2019.
Alas, whilst a score of 1.4% is a step in the right direction, it is still below the bank’s target range, making the prospect of a rate hike anytime soon extremely unlikely.
Pound Trades Higher Against US Dollar (GBP/USD) – US Retail Sales Imminent
Whilst concerns over the situation in Syria have ebbed somewhat, the GBP/USD exchange rate remains firmly in the Pound’s favour, with markets still hesitant to assess the severity/form of the Russian response to the recent missile barrage from the US, France and the UK.
On the data front, markets are waiting for today’s US retail sales figures for March, with a rise expected from -0.1% to 0.4%.
This result could give the US Dollar a well-needed shot in the arm, but with the UK’s labour market figures looming, the market spotlight will likely remain on Sterling.
GBP/CAD Exchange Rate Climbs as Crude Oil Prices Weaken
The Canadian Dollar is mostly weaker today, paring recent gains as crude oil prices weakened.
This was largely due to the possibility of military conflict in Syria diminishing, thus helping crude prices weaken.
On the NAFTA front, US Vice President Pence and Canada’s Prime Minister Justin Trudeau reiterated that a deal could be reached within weeks at the Summit of the Americas in Lima, Peru.
US President Donald Trump has asserted that negotiations will continue ‘forever’ unless Mexico and Canada are willing to make concessions, however.
Today is void of Canadian data, although Wednesday will feature the Bank of Canada’s April rate decision, as well as a speech from Governor Poloz at the accompanying press conference and the bank’s monetary policy report.
GBP/AUD Exchange Rate Rallies Ahead of Tuesday’s China Ecostats
The Pound Australian Dollar (GBP/AUD) exchange rate traded higher on Tuesday as markets prepared for tomorrow’s highly significant Chinese ecostats and Reserve Bank of Australia (RBA) meeting minutes.
Tuesday will feature China’s GDP readings for Q1 2018, retail sales, and industrial production results; all of which are capable of shifting the ‘Aussie’ Dollar up or down.
If GDP does accelerate as expected it will support commodity prices and Australia’s terms of trade.
Conversely, a below-forecast reading could limit demand for the Australian Dollar.
GBP/NZD Exchange Rate Unperturbed by Substantial Rise in New Zealand Food Inflation and Services PSI
New Zealand data was rather upbeat last night, with their latest services PSI print climbing from 55.3 to 58.8 and food inflation surging from 0.1% to 1.4% in March.
This was, however, not enough to swing the GBP/NZD exchange rate out of Sterling’s favour, with markets favouring the Pound on optimism for tomorrow’s UK labour market figures.
Looking ahead, this week will feature the bi-weekly global dairy trade price auction results, with a rise in dairy prices liable to give the New Zealand Dollar (NZD) a little push.
This week the US Dollar was touching three-year highs when valued against a basket of major currencies. The greenback’s traditional role as one of the safe-haven currencies is helped by a domestic economy that is largely immune to the threats of the coronavirus.
Last update: 22 Feb, 2020
The strong start to the year for “risk-on” currencies is already a distant memory.
Posted: 3 Feb, 2020
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