Foreign Exchange Rates : Currency Predictions - GBP, USD, EUR, AUD, NZD, CAD

8 Apr 2011 at 5 PM - Written by John Cameron

STORY LINK Foreign Exchange Rates : Currency Predictions - GBP, USD, EUR, AUD, NZD, CAD

POUND STERLING

Sterling once again failed to make gains against any majors with the exception of the safe haven Yen and Dollar. This morning’s Producer Price Index figure came out higher than expected, printing at its highest level since 2008, increasing calls from economists for a raise in base rate. However, when even positive data fails to strengthen a currency, warning bells ring. NEAR-TERM OUTLOOK – NEUTRAL TO NEGATIVE.


US DOLLAR – The Pound Dollar exchange rate (GBP/USD) is 1.6338

The Dollar came under further pressure in early trading today following last night’s positive session for Asian equities. With oil prices breaking to a new 32-month high, the Greenback may come experience further downside next week. The EUR/USD and GBP/USD rates rose to new multi-month highs on the day, as failure to agree the federal budget in the States has further hindered the US currency. NEAR-TERM OUTLOOK – NEUTRAL TO NEGATIVE.


EURO – The Pound Euro exchange rate (GBP/EUR) is 1.1323

The Euro enjoyed gains on the day, in spite of the ongoing sovereign debt problems in the Eurozone. The markets have responded positively to the ECB swift action in formulating a plan for financing Portugal’s bail-out. Policy makers have stated that they expect the bail-out to be in place by the middle of next month. This morning’s slightly disappointing German trade figures failed to halt the Euro’s progress. NEAR-TERM OUTLOOK – NEGATIVE.


AUSTRALIAN DOLLAR – The Pound Australian Dollar exchange rate (GBP/AUD) is 1.5509

The Aussie make further gains on the day following positive equities sessions in Asia and Europe. Risk sentiment was further buoyed by the ECB’s actions in swiftly arranging terms for the Portuguese bail-out. With the GBP/AUD exchange rate now within striking distance of its 23-year low, a further move forward for commodities next week could see trading in the 1.40s for the first time ever. NEAR-TERM OUTLOOK – POSITIVE.


NEW ZEALAND DOLLAR – The Pound New Zealand Dollar exchange rate (GBP/NZD) is 2.0886

Once again, the New Zealand Dollar moved in the same direction as it’s Australian sister-currency. However, the Kiwi’s gains have been of a lesser extent than the Aussie’s due to the fact that New Zealand Central Bank interest rate stands at 2.5% as opposed to Australia’s 4.75%. Next week’s session starts with a slew of NZ Housing Market data which will set the tone for the week ahead. NEAR-TERM OUTLOOK – NEUTRAL TO POSITIVE.


CANADIAN DOLLAR – The Pound Canadian Dollar exchange rate (GBP/CAD) is 1.5624

The CAD has once again failed to make up any significant ground against the other majors, in spite of the price of a barrel of crude oil breaking to a new 32-month high. It is likely that following the ECB’s decision to raise rates, the global economy has entered a new interest-rate hiking cycle, which is causing commentators to fear a slow-down in economic activity. Worse-than-anticipated job creation figures this afternoon further held back the CAD. NEAR-TERM OUTLOOK – NEUTRAL.

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