Data absence provides relief for Sterling

Yesterday was again absent of any data for the UK which allowed further relief from the losses suffered in recent weeks. The pound enjoyed a good mornings’ trading with rates continuing to correct against the likes of the Euro and US Dollar after suffering a 5-6% drop last month. By lunch we saw the best buying levels against the Euro is over 2 weeks, and the highest so far this month against the greenback. These movements are however considered to be nothing more than a natural correction with the current trend still very much against the pound. This was evident in the afternoon as traders took the opportunity to sell rates back down again from these highs within a matter of hours. This is however giving buyers a far better opportunity to fix their exchange rates before rates return to the recent lows, and this can be done with as little as 10% deposit for those who are not quite completely ready, but are naturally concerned about the short term forecasts.

The only data to note from yesterday came out of the Euro-zone in form of their latest growth figures. Actual results impressed and beat expectations with GDP up to 1.5% on the year with 0.4% growth confirmed in Q2 of 2015. The Euro however did not find any support from this announcement until later in the afternoon once the US session was underway.

Today kicks off a raft of releases for the UK in the coming days, with Manufacturing and Industrial production due at 9:30am. Expectations are for a no change on the manufacturing figure, but a drop in Industrial production growth, however manufacturing forecasts for the UK have been recently downgraded with major concerns over the effects that wider global issues are likely to have on UK exports. It is therefore very possible that a weaker figure could be seen, and subsequent selling of the pound would be inevitable in the current market. The afternoon also brings a GDP estimate from NIESR which could also be crucial with growth in the UK equally under pressure in the short to mid-term.

For those with a Loonie interest, the Bank of Canada rate decision is at 1:30pm this afternoon, and the Royal Bank of New Zealand will follow suit at 10:00pm tonight. A 0.25% cut in the base rate is forecasts for New Zealand which could see some excellent buying opportunities in the coming days if confirmed.