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

Published: Monday, 11 July 2011 12:13 BST - Written by John Cameron

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

POUND STERLING

In the absence of any significant UK data releases, the Pound has drifted downwards against most of the other sixteen most-actively traded currencies on the day, with the notable exception of the Euro and the Scandinavian currencies. With major developments elsewhere causing a dip in appetite for risk, today’s downward move in the FTSE 100 has placed further selling pressure on the Pound. NEAR-TERM OUTLOOK – NEUTRAL TO NEGATIVE.


US DOLLAR – The Pound Dollar exchange rate (GBP/USD) is 1.5951

The Dollar has seen considerable support in the currency market today as investors shift funds into the safe-haven of the US T-Bill following Friday’s highly disappointing June Non-Farm Payroll figure in the US. Growing concerns that the Eurozone debt crisis may be about to worsen, along with weak Chinese trade data released overnight and fears that the US may be facing its own debt crisis could spell to Dollar strength over coming sessions. NEAR-TERM OUTLOOK – POSITIVE.


EURO – The Pound Euro exchange rate (GBP/EUR) is 1.1320

Following last week’s poor showing, the Euro has given up further ground against the other majors today as fears grow that Italy and Spain may be drawn into the Eurozone sovereign debt crisis. The debt spreads for the two Mediterranean giants has leapt to its widest level since the introduction of the Euro in 1999, whilst the yields on 2-year Greek bonds has risen to over 31%. NEAR-TERM OUTLOOK – NEUTRAL TO NEGATIVE.


AUSTRALIAN DOLLAR – The Pound Australian Dollar exchange rate (GBP/AUD) is 1.4924


The Australian Dollar has suffered some limited downside on the day against the other majors following Friday’s weak US labour market data and concerns that the sovereign debt situation may be about to take a turn for the worse in the US and Eurozone. Last night’s Chinese trade data, which suggested a slowdown in the world’s second largest economy, may lead to further losses for North American equities later today, taking the Aussie lower. NEAR-TERM OUTLOOK – NEUTRAL TO NEGATIVE.


NORWEGIAN KRONE – The Pound Norwegian Krone exchange rate (GBP/NOK) is 8.7678

The Norwegian Krone performed weakly on the day, losing ground against nearly all of the other major currencies. This was partly due to lower than anticipated Norwegian inflation data, released earlier today, which makes a near-term tightening of monetary policy by Norway’s central bank less likely in coming months. The Krone has also suffered because of its exposure to Eurozone sovereign debts and because of fears of a global slowdown following recent weak Chinese data releases, which would hit Norway hard as a major oil exporter. NEAR-TERM OUTLOOK – NEUTRAL TO NEGATIVE.


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