A slew of bad data only managed to momentarily curb this morning’s Pound Sterling (GBP) appreciation, with the headline being an unexpected drop in GDP. The Euro (EUR) has been pushed lower by a slowdown in French economic growth, while the US Dollar (USD) is trending gradually lower as traders pause ahead of key data due out later today.
GBP/EUR Exchange Rate Forecast: Pound Sterling Holds onto Gains Following UK Growth Shock
After dropping from 1.3719 at the start of the week to a ten-week low of 1.3492, Pound Sterling’s recovery has been mostly unharmed by a slew of poor data releases. The final third-quarter figure for UK GDP was revised down from 2.3% to 2.1% year-on-year (YoY), despite predictions that it would hold steady. Second quarter GDP was also revised down to 0.5% after being estimated at 0.7% earlier in the year. Quarterly GDP slowed from 0.5% to 0.4%.
More bad news, including a greater-than-expected slump in the Index of Services from 0.5% to 0.1% in October and a 10 point drop in the Lloyds Business Barometer to 45, has yet to drag on Pound Sterling’s appreciation. Total Business Investment also dropped from 6.6% to 5.8%.
Pound Sterling is managing to extend its gains against the Euro, continuing to trend up 0.4% after earlier news that French GDP slipped from 1.2% to 1.1%, defying predictions that it would remain steady.
GBP/USD Exchange Rate Forecast: US Dollar Bearish Ahead of Key Data Releases
While data is becoming sparse for many of the major economies, with today’s French GDP the last release to come from the Eurozone before Christmas, today sees a glut of US Data, including the Durable Goods Orders and core Personal Consumption figures. As a result, US Dollar trade has been subdued so far, with traders awaiting the key figures. The thin trading volume and lack of appetite has seen the ‘Buck’ (USD) trending down against several major currencies, making losses of -0.1% against the Japanese Yen (JPY) and Indian Rupee (INR) and -0.3% against Pound Sterling.
The US Dollar is managing to trend marginally up against the Euro (EUR).
GBP/EUR, GBP/USD Pre-Christmas Exchange Rate Forecasts
As well as the main releases, today sees several other important pieces of data, including Personal Income, New Home Sales and the University of Michigan Confidence index. More US data follows tomorrow, with Initial Jobless Claims and Continuing Claims, with only UK BBA Loans for House Purchase figures to provide any direction for Pound Sterling. The Eurozone remains quiet until after Christmas.
The Pound Sterling to Euro (GBP/EUR) exchange rate is currently trending in the region of 1.3602, while the Euro to Pound Sterling (EUR/GBP) exchange rate is trading around 0.7351.
The Pound Sterling to US Dollar (GBP/USD) exchange rate is currently trading in the region of 1.4869, while the US Dollar to Pound Sterling (USD/GBP) exchange rate is trending around 0.6725.
Comments are closed.