Push for pound or running out of steam

Last week saw a fast start for GBP as following Wednesday’s inflation and Thursday’s unemployment data it gained ground across most of the board but in particular against EUR and USD.Movement slowed Thursday and Friday as we saw little data of note released, and that which was (EURO CPI) came in as expected. Interestingly as a result rates for those selling GBP to other currencies dropped, and by the close of trading Friday against the majors GBP found itself in a similar position at the start with much of the week’s gains eroded.Given that in the last year GBP has been the strongest of all currencies and has grown almost 10%, add to that the rapid gains we have seen in only the last few months, this contraction may well be expected. Without further good data from the UK, GBP could run out of steam and a correction in rates will occur – as we are presently seeing. Certainly with the UK being relatively spoilt with all the good news recently, added with the weak USD and EUR this is a definite risk. So be aware as any slow in good news from the UK, or indeed a change in fortune for the greenback or single currency could see the tables turned quickly and rates drop. Those of you with upcoming requirements would be well advised to stay in close contact with your CI broker, who can assist you and also alert you as and when the market moves.

This week has another quiet start as Monday sees no data of major note. As we move into Tuesday USD takes centre stage with a raft of CPI data released, so it will be interesting if the USD can maintain its slow march down from its 6 year low against GBP. Wednesday we have a number of GBP releases as we see the BoE MPC cut, where we are unlikely to see a change in the vote but we also see the BoE minutes which always has the ability to move rates. Elsewhere Wednesday we also have AUD CPI data and the NZD interest rate decision. Thursday we have a large number of releases both from the UK and Europe, however all of which are not of major note, other than the JPY CPI data. Finally on Friday we have UK GDP and USD durable goods data, so overall a fairly busy week and one which we could see rates push either way. Could the pound regain momentum or is it running out of steam?Speak to your CI broker today for some friendly and professional guidance on how to get the most out of your transfer. Currency Index can help you stay well informed and well ahead of the market.

Tuesday

• 03.00     AUD       RBA Governor Glen Stevens speech#
• 12.30     USD       CPI data

Wednesday

• 01.30     AUD       CPI data
• 08.30     GBP       BoE minutes
• 21.00     NZD       RBNZ Interest rate decision

Thursday

• 23.30     JPY         CPI data

Friday

• 08.30     GBP       GDP data
• 12.30     USD       Durable goods orders