Nervous times for exchange rates ahead of retail sales

Yesterday saw a slight correction in rates for GBP following the release of the BoE minutes in the morning detailing the MPC interest rate vote. The minutes showed that 2 of the 9 members voted again for a hike amidst a great deal of speculation that in fact they would stop voting for an increase in rates, which they have been doing since August. As a result of this failed speculation throughout the day GBP gained 70 pips against EUR, settling around a half cent gain by the end of the day’s trading.

Against the Dollar and amidst much speculation ahead of the FOMC minutes – that it would echo a more hawkish outlook- the pound gained a cent against the Dollar throughout the day, welcomed by many given the recent gains made by the USD against GBP.

The EUR/USD cross also saw movement both ahead and following the FOMC minutes and similarly weakness for USD saw EUR gain back 50 pips throughout the day.

This morning we have already seen a slight correction again in USD rates with much of the loss (partly due yesterday’s speculation) eroded. However it is a very busy day for USD with a flurry of data this afternoon including jobless claims but more significantly CPI data.

It will be an interesting watch to see if the Dollar continues its recent onslaught against both the Euro and Pound.

For GBP all eyes will be focused on the morning release of retail sales, particularly given the ongoing weakness surrounding the interest rate hike delays. There has been a deal of speculation that the result may come in poor given the mild weather in the UK and that as a result many have not started their Christmas shopping yet. Interestingly however we have seen GBP strengthen slightly this morning ahead of the result, so certainly it will be one to watch. With the current volatility of GBP crosses you would be well advised if you have any upcoming GBP transfers to stay in close contact with your Currency Index broker as with rates and the market could push either way.

Speak to your CI currency broker today for some friendly and profesional guidance on how to get the most out of your currency transfer. Currency Index can help you stay well informed and well ahead of the markets.