The Pound Sterling to US Dollar (GBP/USD) exchange rate moved away from a one-month low on Thursday while the Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate shed -0.3% over the course of the European session.
Pound Sterling to US Dollar (GBP/USD) Exchange Rate Forecast: FOMC Cite Greece as Reason for Leaving Interest Rates on Hold, Jobless Claims Rise to Highest Level since February
The Pound Sterling to US Dollar (GBP/USD) exchange rate slumped to a one-month low on Wednesday despite UK housing data printing above expected levels as a bullish ‘Greenback’ advanced against a number of its peers.
However, the GBP/USD currency pair recovered from the 1.53 level to trend on the 1.54 boarder following the publication of minutes from the last Federal Open Market Committee (FOMC) policy meeting.
The minutes pushed back interest rate hike expectations by referencing the current instability in the global economy and inferring that the domestic economic recovery isn’t quite stable enough to warrant higher borrowing costs.
In the view of economist Michael Gapen; ‘I get a reading of a committee that is very insecure about the state of the economy and unwilling to send a clearer signal about rate hikes. The economic activity data has been better, but the risks in the external backdrop have increased.’
Meanwhile, on Thursday the number of people applying for first time unemployment benefits in the US rose to the highest level recorded since February.
Forecasts for a reading of 275,000 proved inaccurate, with applications for initial jobless benefits rising to 297,000 from a revised 282,000 the previous week.
Pound Sterling to Canadian Dollar (GBP/CAD) Exchange Rate Forecast: ‘Loonie’ Gains Following New York Stock Exchange Blip, Canadian Housing Data Impresses
Earlier this week the Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate advanced to fresh multi-year highs as the price of oil plummeted by 6%.
However, Wednesday’s widespread Sterling sell-off saw the Canadian Dollar recover losses in spite of a sharp decline in Canadian building permits.
The Canadian Dollar then gained on the US Dollar as the New York Stock Exchange reopened following an unexplained technical glitch.
Thursday’s Canadian data was more encouraging, with Housing Stats rising by 0.2% on the month in May instead of the 0.1% expected and the New Housing Price Index rising from 1.1% to 1.2% on the year.
As there have been a run of disappointing Canadian ecostats in recent weeks, these above-forecast results were fairly well received.
Oil prices also edged higher as the Chinese stock market began to recover.
Pound Sterling to US Dollar (GBP/USD) and Pound Sterling to Canadian Dollar (GBP/CAD) Exchange Rate Predictions: Greek Bailout Proposals, Canadian Employment Figures in the Spotlight
Whether or not the Pound Sterling to US Dollar (GBP/USD) exchange rate is able to climb any higher largely depends on how the latest developments in Greece pan out. If the Hellenic nation presents its creditors with reform proposals and they are immediately dismissed, the odds of a Grexit will climb and the US Dollar will go back to being in high demand as a safe-haven asset.
The GBP/USD exchange rate may also fluctuate before the weekend as a result of the UK’s latest trade and construction figures and a speech to be given by Federal Reserve Chairwoman Janet Yellen.
Meanwhile, the Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate may experience volatility after the latest Canadian employment figures are published.
Less-than-impressive jobs data might prompt the Bank of Canada (BOC) to reconsider cutting borrowing costs and accordingly weigh on the ‘Loonie’.
Current GBP, USD, CAD Exchange Rates
The Pound Sterling to US Dollar (GBP/USD) exchange rate was trending in the region of 1.5390, the Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate was trending in the region of 1.9540, the Canadian Dollar to US Dollar (CAD/USD) exchange rate was trending in the region of 0.7872 and the Canadian Dollar to Pound Sterling (CAD/GBP) exchange rate was trending in the region of 0.5110
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