Quiet pound makes gains ahead of a noisy day

14 May, 2014

Matthew Boyle

Yesterday was a quiet day for the pound in the way of data however in light of poor data releases from both the Eurozone and US, it  gained ground. In the morning CPI data from Italy was released which came in slightly under expectation (0.5 from an expected 0.6) which started the pounds climb, which was only aided in the afternoon as Eurozone ZEW economic sentiment data also came in well under expectation (55.2 from an expected 63.5) showing a significant change in investor sentiment. As such the pound gained around half a cent over the days trading taking rates to a new high for 2014 – so certainly a good time to buy Euros.

Against the USD the pound also gained as despite FED reserve Chair Yellens comments last week which gave the USD at least some short term strength, US Import price Index and retail sales data all came in well under expectation. This reversed what was for the part a gaining USD against the pound and albeit a small gain the pound ended the day around 30 pips up against the greenback. Buyers take note however – with the GBP>USD rates still not far off a 5 year high and indications that the US Q.E/ bond purchasing scheme may be heavily tapered in the near future these highs may be short lived.

Today is a much more vocal one for the pound as the USD and Euro take somewhat of a back seat with the major data releases all coming from the UK. Following various CPI data releases from the Eurozone countries this morning, all eyes will be set on  the UK at 09.30 as unemployment data is released. Then later this afternoon we have the BoE Inflation report and also a speech by BoE Governor Mark Carney. Certainly for the pound this will be a turbulent day – currently it sits the strongest of the majors but a surprise shift in unemployment figures or any indication in his speech to a future change to interest rates could turn the market wild.

Should any of you have upcoming Currency purchases to make you might like to speak to your CI currency broker today to take advantage of the currently fantastic rates we are seeing against both the USD and Euro. And fear not! Should your purchase not be on the immediate horizon, Currency Index offer a range of currency buying options including forward contracts, so there is no need to miss out. Speak to your CI broker today for some friendly and professional guidance on how to try and get the most out of your money transfer. Currency Index can help you stay well informed and well ahead of the market.