Daily Currency Update
GBP - British PoundThe week ended quietly on Friday apart from comments from Bank of England's Gertjan Vlieghe. Vlieghe, a member of the 9 person voting panel that sets interest rates said to an audience that in a no-deal Brexit scenario interest rates could be cut to almost zero. This didn't come as a shock to the markets and the effect on sterling was negligible but it is important because it underlines once again what many investors are anticipating. It should be a bit more of an exciting week for the pound with a little over a week until the next Prime Minister is confirmed, an event that could confirm the pound's fate over the next few months. Between now and next Tuesday however there's also a raft of data with average earnings, inflation and retail sales all set to come out.
Key Movers
The big overnight news came out from China which on the headlines makes for stark reading. Chinese growth slowed to a 27 year low in the second quarter as the trade war with the US took hold. However there is a slightly risk on mood in the market with the Aussie and Kiwi dollars both benefiting. This came from the uptick in the key manufacturing data, which acts as a good indicator for future growth. The focus for the rest of the week should be towards the dollar and the Federal Reserve meeting at the end of the month whereby the market expects the FOMC to cut its interest rate by a least 25 basis points but the key question will be whether more cuts could follow, an event that could add pressure to the USD.
Expected Ranges
- GBP/USD: 1.2475 - 1.2580 ▲
- GBP/EUR: 1.1090 - 1.1160 ▲
- GBP/AUD: 1.7850 - 1.7920 ▲
- GBP/NZD: 1.8675 - 1.8820 ▼
- GBP/CAD: 1.6280 - 1.6395 ▼