Pound gains short lived

Yesterday saw a quiet day on the market with no notable data releases that affected the major currency pairings. The Pound is desperately clinging on to the gains it had received from news of the ECB’s potential rate cut last week and as the days go by the Pound is beginning to revert to levels seen at the start of last week. It would appear that sentiment is starting to once again influence the Pound’s vulnerable position. In the space of 2 months Sterling has dropped off over 12 cents against the Euro and with no saviour in the way of positive data on the horizon from the UK the likely hood is that the Pound will continue on this current downward trend. For Euro and Dollar buyers a forward contract on today’s Sterling rate could prevent any further losses and secure more foreign currency for your Pound.

Today could see some movement in the currency market as this morning the Bank of England governor Mark Carney speaks, more light can be shed on the decision not to raise interest rates in the UK which could potentially weaken the Pound further. In the afternoon the US release house prices and markit index data. Tomorrow could bring volatility to the market as the FED purchase programme is addressed as is the monetary policy statement.

These next coming days could be vital for the Pound and with its fragile state it may be worth securing your currency sooner rather later as the road to recovery could be a long way off as things look to get worse before they get better. Please keep in contact with your account manger today here at Currency Index for all information and friendly guidance.