End of Day Exchange Rate Outlook Forecast For Major Currencies : GBP, USD, EUR, AUD, NZD, CAD

30 Mar 2011 at 6 AM - Written by John Cameron

STORY LINK End of Day Exchange Rate Outlook Forecast For Major Currencies : GBP, USD, EUR, AUD, NZD, CAD

POUND STERLING

Today’s UK economic data releases provided some much-needed good news for the Pound. The finalised quarterly GDP figure for Q4 was improved upwards to -0.5%, while February Mortgage Approvals were higher than had been expected. However, even with this data Sterling struggled against the other majors. NEAR-TERM OUTLOOK – NEUTRAL TO NEGATIVE.


US DOLLAR – The Pound Dollar exchange rate (GBP/USD) is 1.5980

This afternoon’s closely-watched US Consumer Confidence figure for March came out worse than analysts had anticipated, causing a dip in risk sentiment following the improvement of earlier in the week. The tone of comments by Federal Reserve members has given some hope for a tightening of US monetary policy, providing further support for the US Dollar. Tomorrow’s US labour market figure will give an indication of the likely effect of Friday’s key Non-Farm Payrolls number. NEAR-TERM OUTLOOK – NEUTRAL.


EURO – The Pound Euro exchange rate (GBP/EUR) is 1.1349

Futures markets are predicting that the ECB Lending rate will be over 2% this time next year, with the first rate hike coming next week. This has allowed the Euro to maintain its top-of-the-recent-range rates against both Sterling and the US Dollar, in spite of concerns over possible sovereign debt defaults by Greece and Portugal. Some analysts have suggested that all of the good news is now factored-in for the Euro and it may be due a technical retracement against the other majors. NEAR-TERM OUTLOOK – NEUTRAL TO NEGATIVE.


AUSTRALIAN DOLLAR – The Pound Australian Dollar exchange rate (GBP/AUD) is 1.5580

The Australian Dollar has enjoyed another day of gains against the majors as the high-yielders continue to claw back the losses which they suffered following the recent Japanese-Earthquake-induced market panic. However, today’s gains have been of a lesser magnitude than those of previous sessions. Friday’s US Non-Farm Payroll will be the key determinant in deciding whether the Aussie breaks to new short-term highs or whether it will succumb to profit-taking. NEAR-TERM OUTLOOK – NEUTRAL TO POSITIVE.


NEW ZEALAND DOLLAR – The Pound New Zealand Dollar exchange rate (GBP/NZD) is 2.1189

The Kiwi has made significant gains on the day following last night’s domestic export figure. The figure showed that the NZ economy enjoyed a trade surplus for the first time in 8 months, with milk powder and lumber leading the way. This is the latest figure to suggest that the real economy is successfully weathering the Christchurch earthquake. NEAR-TERM OUTLOOK – NEUTRAL TO POSITIVE.


CANADIAN DOLLAR – The Pound Canadian Dollar exchange rate (GBP/CAD) is 1.5589

Commodity prices are edging down from their near-term highs, meaning there is the potential for Canadian weakness in upcoming sessions. However, the CAD remains sensitive to US data releases, due to America’s status as Canada’s primary export partner. With this afternoon’s US Consumer Confidence Survey disappointing analysts, there is potential for CAD downside. NEAR-TERM OUTLOOK – NEUTRAL TO NEGATIVE.

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