Big week for data – could it mark the start of a downfall in GBP rates?

10 February, 2020

Matthew Boyle

Last week was a poor one for the Pound with little good news of any note, and one where it saw buying rates slowly slip back. With an underlying suggestion of an impending interest rate cut in the UK , combined with growing uncertainty of how the Trade deal with the EU will shape up, downside risk remains high. Across the Atlantic, the USD seems very strong at present and has gained significant ground against both the Pound and Euro – around 2 cents against both in the last month. Perhaps concerningly here is the strengthening dollar and has not seen the Euro weaken against Sterling under the see-saw effect, and the Euro is in fact slowly stealing ground against the Weakened Pound – now 2 cents down in the last 2 months.

Whilst for a long-time sentiment has largely driven rates, ecostats and data have made a return and are now having a much greater significance in moving exchange rates, particularly where the Pound is concerned as they play a crucial role in determining whether and indeed when we will see a change to the interest rate. And this week is a very busy one for data, with several key releases. Tuesday is a critical day for GBP, as we have manufacturing and production data, alongside Trade and GDP stats – poor results here could be the catalyst for a cut in the short-term and as such we could see rates drop if the news is bad. On the same day we also have the European Commission growth forecasts, and knowing the EU can often take a bullish stance and up-sell the Euro, Tuesday could be a tough day for the Pound and a double-whammy could see rates drop significantly.

The week finishes with US retail sales and will be an interesting watch to see if the Greenback will continue its current run, or be halted in its tracks. Certainly though the main focus will be on the Pound and Tuesdays releases. With GBP>EUR rates only 2.5 cents off the best they have been in 3 years and downside risk high and seeming to build, you may like to take advantage now before the rot kicks in and we see rates start to slip.

Speak to your broker today for some friendly and professional guidance on how to remove the risk and get the most from your currency transfer.

09.00 EUR Sentix Investor Confidence
13.15 USD Fed Bowmans Speech
13.15 CAD Housing Data

00.01 GBP Like for like Retail sales
09.30 GBP Manufacturing and Industrial Production, Trade balance data & GDP
10.00 EUR European Commission release Economic growth forecasts
15.00 USD Fed Chair Powell testifies
15.35 GBP Mark Carney Addresses UK Parliament
17.00 GBP BoE Haskell’s Speech

01.00 NZD RBNZ Rate decision and Interest rate decision
10.00 EUR Industrial Production
15.00 USD Fed Chair Powell testifies
19.00 USD Monthly Budget Statement

00.15 CAD BoC Governor Poloz speech
00.15 AUD RBA Governor Lowes speech
07.00 EUR German Inflation data
13.30 USD Inflation and Jobs data
19.00 NZD Business PMI

07.00 EUR German GDP
10.00 EUR GDP data
13.30 USD Retail Sales
15.00 USD Michigan Consumer Sentiment Index