Pound hold its own in currency markets
5 May, 2017
Yesterday saw a continuation of the week’s trends, with the Pound up against the US Dollar, but trading in a tight range against the Euro. A mixed bag of economic data, with good growth in the services sector, but a fall in mortgage approvals and new car registrations, painted a cautiously optimistic picture for the UK economy.
Growth in services, which make up ¾ of the UK economy, suggested healthy overall growth for UK plc in the second quarter of 2017, but rising inflation in the sector is likely to ultimately curb growth, and elsewhere mortgage approvals fell for the second month running while UK house prices are now in decline.
Sterling traded the day higher against the US Dollar, approaching key resistance levels around the best rates for sending US Dollars abroad since October, but fell slightly against the Euro, where we seem to be seeing smaller fluctuations as the real flavour of Brexit negotiations take shape amid the political backdrop of the General Election next month. This morning’s local election results will be an interesting indicator of voter sentiment, but unlikely to move exchange rates significantly.
Non-Farm Payrolls today
The main monthly measure of the US labour market, non-farm payrolls, are announced this afternoon and often have an influential effect on the value of the Greenback when they are announced, which is at 1.30 UK time this afternoon. 185,000 jobs are expected to have been added to the seasonally-adjusted employment figures but estimates are notoriously inaccurate and can cause significant swings in USD exchange rates.
Canadian unemployment figures are also released today.
Overall, exchange rates for sending money abroad remain near their best levels since the Brexit referendum against most currencies, particularly if you are looking to buy Australian, US or Canadian Dollars, and with the UK general election providing more potential political uncertainty as European leaders close rank after Theresa May’s anti-EU outburst this week, is it worth holding out for any further improvement in the current climate? More is often lost by indecision than a poor one, so consider fixing your exchange rate for that foreign purchase or invoice, and make sure you don’t lose out.
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