Inflation as expected, exchange rates remain volatile
17 September, 2014
Yesterday’s UK inflation figures came out pretty much as expected, with the Pound falling through the morning and recovering in the afternoon against most currencies. Market movements are still more than we might expect, as uncertainty continues in the lead up to the Scottish referendum.
This morning we have the important matter of the Bank of England minutes to contend with, as we discover if any more MPC members voted for a UK interest rate rise this month. Last month, 2 of the 9-strong committee wanted to see interest rates increased, but since then Mark Carney, the Bank’s Governor, has hinted that there won’t be an interest rate rise until next Spring. Interest rate rises are a key influence on exchange rates, so if 2 or less members voted for a rise in September, we could see the Pound fall back.
We also have Eurozone inflation today, for those of you sending Euros abroad in the coming weeks, at 10am. Euro exchange rates recovered yesterday afternoon close to recent highs, as the single currency bloc is still struggling for growth; look out for inflation figures below the expected 0.9% which could indicate further economic problems and a cheaper Euro this morning.
If we do see Euro rates improve today, this could be a key opportunity to secure an exchange rate before tomorrow’s Scottish referendum. It is extremely likely that signs of a “Yes” victory would weigh heavily on the Pound and could easily bring exchange rates tumbling down significantly overnight tomorrow and into Friday. Such movements can take many weeks to recover.
Finally today for the US Dollar we have the Federal Reserve’s monetary policy statement at 7pm.
Given the pace of development in financial markets this month, if you have a currency transfer to make, don’t leave your exchange rate to chance. An account with Currency Index gives you access to a personal currency broker in our team to discuss your options – register with us today and see how we can help save you money compared to your bank, as well as guide you through these unstable times for exchange rates.
- 2020 (59)
- 2019 (190)
- 2018 (229)
- 2017 (253)
- 2016 (254)
- 2015 (253)
- 2014 (252)
- 2013 (287)
- 2012 (270)
- 2011 (576)
- Brexit deal to be done, or going, going, gone? 25 November, 2020
- Sterling starts the week down from the highs of last week 16 November, 2020
- Votes are in – albeit still being counted, will Donald trump Joe? 4 November, 2020
- No categories