Pound Sterling (GBP) Advances against CHF and USD Today but Overall Picture Shows Investor Uncertainty
Although yesterday was a tumultuous one for the performance of Pound Sterling (GBP) against rivals like the Euro (EUR)and US Dollar (USD), today promises to be equally dramatic in terms of GBP movement against its peers.
The biggest source of GBP value-shifting yesterday was the debate that took place in the House of Commons, with much of the focus revolving around PM David Cameron’s recently secured draft referendum terms.
For the most part, Sterling stayed in a favourable position against the competition due to the fact that his defence of the current terms was conducted in a competent and generally direct manner.
Current GBP-CHF-USD Exchange Rates
On Monday the Swiss Franc to British Pound exchange rate (CHF/GBP) converts at 0.88
At time of writing the pound to swiss franc exchange rate is quoted at 1.137.
Today finds the pound to us dollar spot exchange rate priced at 1.255.
Today finds the pound to chinese yuan spot exchange rate priced at 8.874.
Please note: the FX rates above, updated 6th May 2024, will have a commission applied by your typical high street bank. Currency brokers specialise in these type of foreign currency transactions and can save you up to 5% on international payments compared to the banks.
UK House Price Data Impacts Pound Sterling (GBP) Exchange Rate Movement
This morning, the Pound has been most affected so far by the announcements of the Halifax January House Prices as well as the nation’s New Car Registrations on the year in the same month.
In all respects, the figures have risen prodigiously, something that has failed to generate a significant amount of interest in Sterling so far today.
The hindering factor is thought to be the ‘Super Thursday’ event which is still to come – the Bank of England (BoE) Interest Rate Decision and inflation report. As per usual, no change is expected for the current UK interest rate, therefore the inflation analysis and any particularly dovish statements from policymakers such as Governor Mark Carney will be the focus of attention today.
Swiss Franc (CHF) Slides against all but USD Today after Poor Domestic Data
Although the price of gold per 100 ounces has steadily risen from under $1130 to over $1145 today, the Swiss Franc has nonetheless been in a state of decline against most of its major peers.
The likely cause for this currently slump is the Q1 Consumer Confidence score that was released this morning; while the result of a move from -18 points to -14 was better than the forecast -15, it still shows a notable absence of confidence from a key part of the nation’s economic composition.
Swiss data to look forward to in the future will next come on Tuesday, with the announcement of the Unemployment Rate for January. At the time of writing, forecasts were for a rise from 3.7% to 3.9%.
US Dollar (USD) Slides after Yesterday’s Lacklustre Ecostats
Exchange rate movement for the US Dollar has been highly unfavourable overall today, with the likely cause being a continued negative reaction to prior economic announcements.
Yesterday afternoon saw the announcement of the US ISM Non-Manufacturing Composite, which instead of falling from 55.8 to 55.2 instead printed much lower at 53.5.
US data to watch out for this afternoon includes the Initial Jobless and Continuing Claims figures for January, as well as the nation’s durable goods and factory orders for December. Pessimistically, predictions have been for rising claims and falling factory orders.
GBP Forecast: BoE Interest Rate Freeze Predicted Today, Possibility for Bolder Moves in the Future
While it is highly unlikely that the Bank of England (BoE) will raise the UK interest rate today, some economists have been weighing in on the circumstances that could trigger the coveted UK interest rate hike.
JP Morgan Chase economist Allan Monks has commented on the general volatility of the situation for the BoE, both within the UK and without. Monks summarises the hindering factors as:
’a discussion of the global economy, low inflation, risks from the recent turbulence in financial markets and…the government’s decision as to when to hold the UK’s ‘Brexit’ Referendum’.
Industry experts are also speculating about the future path of US fiscal policy. As US data has largely disappointed in recent days there's every chance the Federal Reserve will have to reconsider its current plans to increase borrowing costs gradually over the course of 2016.
Bank of England Hawk Shocks with Dovish Interest Rate Vote
The Bank of England left interest rates on hold, as expected, although a dovish Monetary Policy Committee (MPC) caused Pound Sterling to tumble.
The main news from the decision was the fact that the usually hawkish Ian McCafferty dropped his dissenting vote and this time the decision to hold interest rates was unanimous.
Despite a dovish inflation report, Schroders has a more dovish outlook, with European economist Azad Zangana explaining: ‘one major difference between the Schroders forecast and the BoE’s is that we forecast GDP growth to slow in 2017 on the back of accelerated austerity and higher inflation. The BoE, on the other hand, expects growth to accelerate in 2017, from a temporary dip this year’