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25th May 2017-Fed Members consider it prudent to wait before hiking rates

 

     

Fed Members consider it prudent to wait before hiking rates

Minutes from May’s Federal Reserve meeting stated that the overall economic assessment was little changed with consumer spending expected to rebound given solid economic fundamentals. Most officials regarded the soft inflation data as transitory, although a few were concerned that progress towards the inflation target had slowed. Overall, members considered it prudent to wait for further evidence that recent economic weakness was transitory before hiking rates again.

The general tone was less hawkish than expected with an increased potential for the Fed to hike rates again in June and then pause to consider developments. The dollar weakened after the announcement with the trade-weighted index below the 97.0 level as US yields moved lower.

Risk conditions held firm and a weaker US tone provided additional support for commodity currencies while oil prices held a strong tone into the OPEC meeting.

Sterling gained initial support from the strong tone in oil prices, although support faded during the day. The UK currency was also undermined by the inability to break back above the 1.3000 level in GBP/USD and dipped to lows just below 1.2930 as GBP/EUR tested the 1.1520 area.

UK developments were very limited with the General Election campaign still suspended following the Manchester terrorism attack. Sterling was hampered by underlying concerns surrounding EU 

     
 
       
 

GBP/EUR 

– 1.1559

 
 

GBP/USD 

– 1.2985

 
 

GBP/CHF 

– 1.2627

 
 

GBP/JPY 

– 145.04

 
 

GBP/AUD 

– 1.7310

 
 

GBP/NZD 

– 1.8425

 
 

GBP/CAD 

– 1.7397

 
 

GBP/ZAR 

– 16.7412

 
 

GBP/NOK 

– 10.8024

 
 

GBP/SEK 

– 11.2483

 
 

EUR/USD 

– 1.1233

 
       
  All rates are indicative of interbank rates*  
       
 
 

GBP/EUR 

 
 

GBP/USD 

 
 

EUR/USD 

 
       
 
   

09:30 GBP

United Kingdom GDP (Q/Q)

0.30%

0.30%

 
   

09:30 GBP

United Kingdom GDP (Y/Y)

2.10%

2.10%

 
   

09:30 GBP

BBA Mortgage Approvals

40.8K

41.1K

 
   

13:30 USD

US Initial Jobless Claims

-

232K

 
 
   
 
 
*All rates shown are indicative of interbank rates and should only be used for indication purposes only. It is important to note that foreign exchange rates fluctuate and that rates may vary depending on the amount and the base currency that is purchased or sold. Rates are correct as of 8:00am UK time.  CentralFX are not responsible for the rates shown.
 
 
 

24th May 2017-Trading activity subdued following Manchester attack

 
     

Trading activity subdued following Manchester attack

The dollar remained firmly on the defensive in Europe on Tuesday with robust Euro-zone data helping to support Euro sentiment. EUR/USD pushed to fresh 6-month highs above 1.1260 as the dollar index remained under pressure.

There was a significant reversal in US trading as the Euro was hit by profit taking. An increase in US yields also provided renewed dollar support with a correction from sharp losses seen during the past few days.

Risk appetite was stable with internal confidence illustrated by resilience in the face of a credit rating downgrade for China and UK terrorism attack. A dollar recovery and firm equity-market tone triggered a dip in demand for defensive assets as gold and the yen weakened significantly.

The latest UK government borrowing data recorded a larger than expected borrowing requirement of GBP10.4bn for April from GBP9.2bn last year the highest April reading for 3 years.

The May CBI retail sales survey declined sharply to 2 for May from 38 previously and retailers were expecting only a limited recovery for June, maintaining expectations of an underlying slowdown.

The terrorism attack in Manchester had an important impact in curbing trading activity. The UK terror rating was raised to the highest level of critical and General Election campaigning will remain suspended on Wednesday.

GBP/USD overall continued to hit selling interest above the 1.3000 with a move to 1.2970 as the dollar recovered ground, although GBP/EUR did edge to lows of 1.1569 before rebounding.

     
 
       
 

GBP/EUR 

– 1.1602

 
 

GBP/USD 

– 1.2976

 
 

GBP/CHF 

– 1.2659

 
 

GBP/JPY 

– 145.16

 
 

GBP/AUD 

– 1.7400

 
 

GBP/NZD 

– 1.8518

 
 

GBP/CAD 

– 1.7558

 
 

GBP/ZAR 

– 16.9700

 
 

GBP/NOK 

– 10.8862

 
 

GBP/SEK 

– 11.3038

 
 

EUR/USD 

– 1.1180

 
       
  All rates are indicative of interbank rates*  
       
 
 

GBP/EUR 

 
 

GBP/USD 

 
 

EUR/USD 

 
       
 
   

09:30 EUR

ECB Praet Speech

-

-

 
   

13:45 EUR

ECB President Mario Draghi's Speech

-

-

 
   

15:00 CAD

BoC Rate Decision

-

0.50%

 
   

19:00 USD

US Fed FOMC Minutes

-

-

 
 
   
 
 
*All rates shown are indicative of interbank rates and should only be used for indication purposes only. It is important to note that foreign exchange rates fluctuate and that rates may vary depending on the amount and the base currency that is purchased or sold. Rates are correct as of 8:00am UK time.  CentralFX are not responsible for the rates shown.
 
 
 

23nd May 2017-The UK currency was again unsettled to some extent by political considerations during the day

 
     

 

The UK currency was again unsettled to some extent by political considerations during the day

The dollar has remained on the defensive with the US currency index declining to fresh 7-month lows below the 97.00 level with a test of support near 96.80 in early Europe on Tuesday before a slight recovery.

The Euro gained fresh support following comments from German Chancellor that the Euro was too weak, especially as it reinforced expectations that the US Administration would push for stronger currencies relative to the US dollar in an attempt to curb the US trade deficit against Germany and Japan.

Risk conditions held a steady tone during Monday with gains in equity markets, although a presumed UK terrorism incident had some negative impact on risk sentiment in Tuesday’s Asian session. Commodity currencies secured significant net gains during the past 24 hours with the weaker US currency providing net support.

The UK currency was again unsettled to some extent by political considerations during the day. Opinion polls suggesting a narrowing of the Conservative Party’s lead in the June 8th General Election and the shifting of policy surrounding social care triggered some degree of uncertainty.

There were also concerns surrounding the forthcoming EU exit talks, which hampered sentiment, especially with fears that EU demands for a very substantial exit payment could risk a breakdown in talks.

GBP/USD again hit selling interest above the 1.3000 level as GBP/EUR fell to 1.1535

A suspected terrorist incident in Manchester late on Monday, which has killed at least 22 people, had some negative impact on the UK currency as GBP/USD held below the 1.3000 level on Tuesday.

 

     
 
       
 

GBP/EUR 

– 1.1562

 
 

GBP/USD 

– 1.2977

 
 

GBP/CHF 

– 1.2645

 
 

GBP/JPY 

– 144.80

 
 

GBP/AUD 

– 1.7326

 
 

GBP/NZD 

– 1.8486

 
 

GBP/CAD 

– 1.7516

 
 

GBP/ZAR 

– 17.2481

 
 

GBP/NOK 

– 10.8420

 
 

GBP/SEK 

– 11.2963

 
 

EUR/USD 

– 1.1223

 
       
  All rates are indicative of interbank rates*  
       
 
 

GBP/EUR 

 
 

GBP/USD 

 
 

EUR/USD 

 
       
 
   

07:00 EUR

Germany GDP (Y/Y)

1.70%

1.70%

 
   

07:00 EUR

Germany GDP (Q/Q)

0.60%

0.60%

 
   

10:00 GBP

BoE Inflation Report(Q/Q)

-

-

 
   

14:45 USD

USD Manufacturing PMI

53

52.8

 
 
   
 
 
*All rates shown are indicative of interbank rates and should only be used for indication purposes only. It is important to note that foreign exchange rates fluctuate and that rates may vary depending on the amount and the base currency that is purchased or sold. Rates are correct as of 8:00am UK time.  CentralFX are not responsible for the rates shown.
 
 
 

22nd May 2017-Risk conditions hold steady following no political developments in the US over the weekend

 

     

Risk conditions hold steady following no political developments in the US over the weekend

Risk appetite overall recovered with significant gains in equity markets. Late in the US session, there were reports that a current member of the Washington Administration was a person of interest in the on-going investigation into Russian involvement in the 2016 Presidential Election. The news triggered a late dip in the dollar as EUR/USD tested fresh six-month highs above 1.1200 with the dollar index close to 7-month lows.

Risk conditions held broadly steady on Monday with relief that there had been no further major negative US political developments over the weekend, although with only limited dollar relief.

The CBI industrial trends survey recorded an increase to 9 for May from 4 the previous month and the highest reading since February 2015 while export orders were at the highest level since December 2013.

Sterling was able to gain fresh ground following the mini ‘flash-crash’ seen on Thursday and there was a fresh move back above the 1.3000 level for GBP/USD.

There was a further decline in net short Sterling positions to the lowest level for close to 12 months, lessening the risk of a further position squeeze.

The latest opinion polls indicated a narrowing of the Conservative Party lead and any further erosion of support could unsettle Sterling, especially with Brexit Davis Secretary Davis warning that the UK would walk away from talks if the exit Bill if exit fees were too high.

GBP/USD dipped back below 1.3000 on Monday with further selling interest above this level and GBP/EUR fell to 1.1593.

 

     
 
       
 

GBP/EUR 

– 1.1621

 
 

GBP/USD 

– 1.3000

 
 

GBP/CHF 

– 1.2680

 
 

GBP/JPY 

– 144.80

 
 

GBP/AUD 

– 1.7454

 
 

GBP/NZD 

– 1.8738

 
 

GBP/CAD 

– 1.7582

 
 

GBP/ZAR 

– 17.1466

 
 

GBP/NOK 

– 10.8832

 
 

GBP/SEK 

– 11.3519

 
 

EUR/USD 

– 1.1181

 
       
  All rates are indicative of interbank rates*  
       
 
 

GBP/EUR 

 
 

GBP/USD 

 
 

EUR/USD 

 
       
 
   

13:30 USD

Chicago Fed National Activity Index

-

0.08

 
   

15:00 USD

FOMC Harker Speech

-

-

 
   

15:30 USD

FOMC Member Kashkari Speaks

-

-

 
   

18:30 AUD

RBA Assist Gov Debelle Speaks

-

-

 
 
   
 
 
*All rates shown are indicative of interbank rates and should only be used for indication purposes only. It is important to note that foreign exchange rates fluctuate and that rates may vary depending on the amount and the base currency that is purchased or sold. Rates are correct as of 8:00am UK time.  CentralFX are not responsible for the rates shown.
 
 
 

19th May 2017-Mini flash crash in GBP just after the European close as volatility remains elevated

Daily News

 
     

 

Mini flash crash in GBP just after the European close as volatility remains elevated

After another slide in risk appetite ahead of the US open, conditions more stable during the New York session with some calming of the immediate political frenzy surrounding President Trump and the US Administration. Global equity markets stabilised with US indices and the dollar able to secure a limited net recovery.

Overall demand for defensive assets faded slightly with gold and the yen losing some degree of support. There were still important underlying tensions amid fears that fresh turbulence could erupt at any moment and uncertainty whether equity-market gains were a brief correction ahead of further losses or indicative that buyers had regained control.

Sterling gained support from strong retail sales data, although there was a mini flash crash just after the European close as volatility remained a key focus.

The UK retails data was much stronger than expected with a 2.3% increase in volumes for April compared with consensus forecasts of a 1.0% gain to give a 4.0% year-on-year gain.  Sales were boosted by the late Easter and favourable weather conditions and there were still market expectations that underlying spending would slow.

The data did however, trigger fresh Sterling buying with GBP/USD breaking above 1.3000 for the first time in close to 8 months.

There was no significant impact from the Conservative Party manifesto, although the loosening of medium-term fiscal policy could increase the potential for an earlier than expected increase in interest rates.

Sterling held strong into the European close, but Sterling then declined sharply in a mini flash-crash with GBP/USD dipping to below 1.2900 before recovering ground to 1.2950.  

 

     
 
       
 

GBP/EUR 

– 1.1642

 
 

GBP/USD 

– 1.2953

 
 

GBP/CHF 

– 1.2690

 
 

GBP/JPY 

– 144.06

 
 

GBP/AUD 

– 1.7422

 
 

GBP/NZD 

– 1.8794

 
 

GBP/CAD 

– 1.7609

 
 

GBP/ZAR 

– 17.2344

 
 

GBP/NOK 

– 10.9482

 
 

GBP/SEK 

– 11.3790

 
 

EUR/USD 

– 1.1125

 
       
  All rates are indicative of interbank rates*  
       
 
 

GBP/EUR 

 
 

GBP/USD 

 
 

EUR/USD 

 
       
 
   

07:00 EUR

EUR German PPI (Y/Y)

3.20%

3.10%

 
   

11:00 EUR

GBP CBI Industrial Trends Orders 

-

4

 
   

13:30 CAD

CAD CPI (Y/Y)

-

1.60%

 
   

14:15 USD

FOMC Member J. Bullard Speaks

-

-

 
 
   
 
 
*All rates shown are indicative of interbank rates and should only be used for indication purposes only. It is important to note that foreign exchange rates fluctuate and that rates may vary depending on the amount and the base currency that is purchased or sold. Rates are correct as of 8:00am UK time.  CentralFX are not responsible for the rates shown.
 
 
 

18th May 2017-US political concerns remained a key focus speculation Trump could face impeachment

 

     

US political concerns remained a key focus speculation Trump could face impeachment


US political concerns remained a key focus during Wednesday with fresh speculation that President Trump could face impeachment.  There were further concerns that economic reform and tax cuts would be delayed, undermining growth potential, and there were also concerns over net capital outflows as confidence in the US faded.

The US currency came under sustained pressure with the dollar index at a fresh 6-month low below 97.50. There was a slide in risk appetite as equity markets declined sharply while demand for defensive assets such as the yen and gold increased sharply.

After the US close, the Justice Department announced that a special counsel would be appointed to oversee the investigation into alleged links between the 2016 Republican campaign and Russia. The move had some impact in calming tensions as the dollar gained some relief.

The UK unemployment rate declined to 4.6% in the three months to March and the lowest rate since 1975 as employment and the participation rate continued to increase. There was, however, a further increase in the jobless claimant count of close to 20,000 for April.

Headline average earnings increased 2.4% in the year to March, in line with consensus forecasts with a 2.1% increase excluding bonuses.

Real earnings declined for the first time in over two years, which will tend to curb consumer spending and the increase in average earnings is not strong enough to increase pressure for a tighter monetary policy.  The Conservative manifesto suggests that fiscal policy will be more expansionary than expected during the next parliament, which could increase the potential for Bank of tightening.

Overall, GBP/USD pushed to 8-month highs just below 1.3000 on wider dollar losses before dipping to the 1.2950 area while GBP/EUR hit 6-week lows at 1.1605.

 

     
 
       
 

GBP/EUR 

– 1.1631

 
 

GBP/USD 

– 1.2947

 
 

GBP/CHF 

– 1.2705

 
 

GBP/JPY 

– 144.13

 
 

GBP/AUD 

– 1.7363

 
 

GBP/NZD 

– 1.8682

 
 

GBP/CAD 

– 1.7636

 
 

GBP/ZAR 

– 16.1647

 
 

GBP/NOK 

– 10.9193

 
 

GBP/SEK 

– 11.3163

 
 

EUR/USD 

– 1.1131

 
       
  All rates are indicative of interbank rates*  
       
 
 

GBP/EUR 

 
 

GBP/USD 

 
 

EUR/USD 

 
       
 
   

09:30 GBP

GBP Retail Sales (Y/Y)

-

1.70%

 
   

13:30 USD

US Initial Jobless Claims

-

-

 
   

18:00 EUR

ECB President Mario Draghi's Speech

-

-

 
   

18:15 USD

FOMC Member Mester Speaks

-

-

 
 
   
 
 
*All rates shown are indicative of interbank rates and should only be used for indication purposes only. It is important to note that foreign exchange rates fluctuate and that rates may vary depending on the amount and the base currency that is purchased or sold. Rates are correct as of 8:00am UK time.  CentralFX are not responsible for the rates shown.
 
 
 

17th May 2017-UK consumer prices rose 0.5% in April with the year-on-year inflation rate increasing to 2.7% from 2.3%

 

     

UK consumer prices rose 0.5% in April with the year-on-year inflation rate increasing to 2.7% from 2.3%

US construction data was weaker than expected with building permits declining 2.6% for April to an annual rate of 1.23mn while housing starts declined to a five-month low of 1.17mn. Futures markets indicated that the chances of a June Fed rate hike had dipped to just below 70% on wider economic doubts following recent data.


US political factors triggered another slide in the dollar during the Asian session on Wednesday. There were reports from a leaked memo written by former FBI Director Comey that President Trump had asked for the investigation into his original National Security advisor Flynn to be stopped. There was a fresh loss of confidence in the Administration and fears over the economic-reform prospects.

The dollar declined sharply against the yen as equity futures retreated while the dollar index dipped to fresh six-month lows below 98.00.  The dollar index lost all the gains seen since Trump’s election victory as economic and political fears sapped support.

UK consumer prices rose 0.5% in April with the year-on-year inflation rate increasing to 2.7% from 2.3%. The rate compared with consensus expectations of 2.6% and was the highest rate since June 2013. There was also a sharp increase in core inflation to 2.4% from 1.8% previously as transport prices were pushed higher by the late Easter.

Producer output prices rose 3.6% in the year to April with the rate unchanged from the previous month.

Markets had priced in a strong figure ahead of the release and a Sterling spike on release was reversed quickly with the UK currency dipping into negative territory.

GBP/USD dipped to lows near 1.2870 before recovering ground while GBP/EUR fell to a six-week low at 1.1605 level. Dollar weakness dominated on Wednesday, but with GBP/USD hitting further selling near 1.2950. 

     
 
       
 

GBP/EUR 

– 1.1617

 
 

GBP/USD 

– 1.2915

 
 

GBP/CHF 

– 1.2688

 
 

GBP/JPY 

– 145.09

 
 

GBP/AUD 

– 1.7377

 
 

GBP/NZD 

– 1.8671

 
 

GBP/CAD 

– 1.7556

 
 

GBP/ZAR 

– 16.9127

 
 

GBP/NOK 

– 10.9085

 
 

GBP/SEK 

– 11.3160

 
 

EUR/USD 

– 1.1116

 
       
  All rates are indicative of interbank rates*  
       
 
 

GBP/EUR 

 
 

GBP/USD 

 
 

EUR/USD 

 
       
 
   

09:30 GBP

UK Average Earning Including Bonus

-

2.30%

 
   

09:30 GBP

UK Unemployment Rate

-

4.70%

 
   

10:00 EUR

Euro-Zone CPI 

1.90%

1.90%

 
   

15:30 USD

US Crude Oil Inventories

-

-5.2M

 
 
   
 
 
*All rates shown are indicative of interbank rates and should only be used for indication purposes only. It is important to note that foreign exchange rates fluctuate and that rates may vary depending on the amount and the base currency that is purchased or sold. Rates are correct as of 8:00am UK time.  CentralFX are not responsible for the rates shown.
 
 
 

16th May 2017-UK currency hampered by expectations of weak growth in real earnings

 

     

UK currency hampered by expectations of weak growth in real earnings

There was a decline in the New York Empire manufacturing index to -1.0 for May from 5.2 the previous month and the weakest reading for seven months. Although confidence in the six-month outlook remained firm, which lessened the potential impact, there were fresh doubts surrounding the economic outlook after recent weak releases.

US political concerns were again a significant focus during the Asian session on Tuesday with reports that President Trump had disclosed classified information with the Russian Foreign Minister without necessary authorisation from the source. The reports fuelled underlying uncertainties and reinforced doubts surrounding the Administration’s economic agenda.

Political and economic uncertainty curbed support for the dollar with the trade-weighted index dipping to test May lows near 98.50.

The sharp decline in speculative short Sterling positons recorded in the latest COT data had an impact in lessening expectations of further short covering, which also sapped buying momentum.

The UK currency was also hampered by expectations of weak growth in real earnings, which would tend to maintain pressure on consumer spending with the April retail sales release due on Thursday.

GBP/USD was unable to break above the 1.2950 level and retreated towards the 1.2910 area later in the US session while GBP/EUR broke below the 1.1750 level with wider Euro support on the crosses.

GBP/USD moved back above 1.2900 ahead of the UK inflation data, although the move was primarily due to a weaker US dollar tone.

     
 
       
 

GBP/EUR 

– 1.1738

 
 

GBP/USD 

– 1.2923

 
 

GBP/CHF 

– 1.2855

 
 

GBP/JPY 

– 146.47

 
 

GBP/AUD 

– 1.7397

 
 

GBP/NZD 

– 1.8734

 
 

GBP/CAD 

– 1.7592

 
 

GBP/ZAR 

– 16.9813

 
 

GBP/NOK 

– 10.9956

 
 

GBP/SEK 

– 11.3802

 
 

EUR/USD 

– 1.1008

 
       
  All rates are indicative of interbank rates*  
       
 
 

GBP/EUR 

 
 

GBP/USD 

 
 

EUR/USD 

 
       
 
   

09:30 GBP

UK CPI (M/M)

-

0.40%

 
   

09:30 GBP

UK CPI (Y/Y)

-

2.30%

 
   

10:00 EUR

German ZEW Survey 

22.3

19.5

 
   

10:00 EUR

Euro-Zone GDP 

1.70%

1.70%

 
 
   
 
 
*All rates shown are indicative of interbank rates and should only be used for indication purposes only. It is important to note that foreign exchange rates fluctuate and that rates may vary depending on the amount and the base currency that is purchased or sold. Rates are correct as of 8:00am UK time.  CentralFX are not responsible for the rates shown.
 
 
 

12th May 2017-The Bank of England left interest rates on hold at 0.25% following the latest MPC meeting

 

     

The Bank of England left interest rates on hold at 0.25% following the latest MPC meeting

The Bank of England left interest rates on hold at 0.25% following the latest Monetary Policy Committee (MPC) meeting, which was in line with consensus forecasts. The 7-1 vote for the decision also met consensus forecasts as Forbes again voted for an immediate rate increase.

Near-term inflation forecasts were revised slightly higher, but with a small reduction in the 2018 and 2019 projections. The bank projected that earnings growth to pick up towards the end of the forecast period and also expected that interest rates would increase by a larger amount than the 0.25% implied by the yield curve.

Sterling overall lost ground after the announcement as there had been some speculation that Saunders could also vote for a rate hike, but found support at lower levels with GBP/USD recovering from 1.2850 lows.

UK industrial production fell 0.5% in March, weaker than consensus expectations of a 0.3% decline and manufacturing declined 0.6%. The latest trade deficit was also wider than consensus forecasts at £13.4bn from £11.4bn the previous month as imports strengthened sharply.

The NIESR GDP estimate slowed to 0.2% in the three months to April with the data overall having a notably soft tone, which undermined Sterling.

The UK currency was unable to gain any traction from the data or Bank of England decision and GBP/USD dipped to lows at 1.2850 before finding some support and edging back to 1.2885 while GBP/EUR fell to 1.1830 area.

     
 
       
 

GBP/EUR 

– 1.1857

 
 

GBP/USD 

– 1.2888

 
 

GBP/CHF 

– 1.2986

 
 

GBP/JPY 

– 146.56

 
 

GBP/AUD 

– 1.7452

 
 

GBP/NZD 

– 1.8836

 
 

GBP/CAD 

– 1.7641

 
 

GBP/ZAR 

– 17.2008

 
 

GBP/NOK 

– 11.0809

 
 

GBP/SEK 

– 11.4453

 
 

EUR/USD 

– 1.0869

 
       
  All rates are indicative of interbank rates*  
       
 
 

GBP/EUR 

 
 

GBP/USD 

 
 

EUR/USD 

 
       
 
   

07:00 EUR

Germany CPI (Y/Y)

2.00%

2.00%

 
   

07:00 EUR

Germany GDP 

1.70%

1.20%

 
   

13:30 USD

USD CPI (Y/Y)

-

2.40%

 
   

15:00 USD

USD Michigan Consumer Sentiment

97

97

 
 
   
 
 
*All rates shown are indicative of interbank rates and should only be used for indication purposes only. It is important to note that foreign exchange rates fluctuate and that rates may vary depending on the amount and the base currency that is purchased or sold. Rates are correct as of 8:00am UK time.  CentralFX are not responsible for the rates shown.
 
 
 

11th May 2017-Risk appetite holds firm as Draghi remains optimistic regarding outlook

 
     

Risk appetite holds firm as Draghi remains optimistic regarding outlook

Economic risk appetite held firm with a robust tone in equity markets, which continued to curb demand for defensive assets. In this environment, the yen failed to sustain gains while the Swiss franc held a weaker tone and gold failed to extend a limited corrective rally.

There was little change in ECB President Draghi’s stance in his speech at the Dutch Parliament. He remained more optimistic surrounding the outlook and commented that downside risks had diminished further while tail risks had also declined.

He also reiterated that inflationary pressures remained weak and that the very accommodative monetary policy was still needed to ensure a sustained increase in inflation over the medium term. Draghi did expect that wages growth would increase in the short term.

Boston Fed President Rosengren maintained his relatively hawkish rhetoric and that a further 3 rate increases were realistic for 2017, although there was little impact on the dollar with markets already having priced in a June rate hike.

Sterling gained support from a sharp gain in oil prices and a firm tone in risk appetite. There was little in the way of fresh domestic market developments during the day with short covering on any significant Sterling retreats. 

GBP/USD consolidated just below 1.2950 with GBP/EUR trading just below 1.1900 ahead of Thursday’s Bank of England monetary policy decision.

 

     
 
       
 

GBP/EUR 

– 1.1892

 
 

GBP/USD 

– 1.2944

 
 

GBP/CHF 

– 1.3041

 
 

GBP/JPY 

– 147.71

 
 

GBP/AUD 

– 1.7561

 
 

GBP/NZD 

– 1.8876

 
 

GBP/CAD 

– 1.7754

 
 

GBP/ZAR 

– 17.4135

 
 

GBP/NOK 

– 11.1330

 
 

GBP/SEK 

– 11.5117

 
 

EUR/USD 

– 1.0882

 
       
  All rates are indicative of interbank rates*  
       
 
 

GBP/EUR 

 
 

GBP/USD 

 
 

EUR/USD 

 
       
 
   

12:00 GBP

BoE Rate Decision(M/M)

0.25%

0.25%

 
   

12:00 GBP

BoE Inflation Report

-

-

 
   

12:00 GBP

BoE QE Purchase Target

435B

435B

 
   

13:00 GBP

GBP NIESR GDP Estimate

-

0.50%

 
 
   
 
 
*All rates shown are indicative of interbank rates and should only be used for indication purposes only. It is important to note that foreign exchange rates fluctuate and that rates may vary depending on the amount and the base currency that is purchased or sold. Rates are correct as of 8:00am UK time.  CentralFX are not responsible for the rates shown.
 
 
 

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Central FX

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