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

Published: Tuesday, 19 July 2011 14:06 BST - Written by John Cameron

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

POUND STERLING

With investors eyeing the release of tomorrow’s Bank of England Minutes from July’s MPC meeting, the Pound has held steady on the day. If the minutes reveal that the nine-man committee discussed an extension to the £200bn of funds already committed to the UK’s Quantitative Easing scheme, then Sterling could come under heavy selling pressure. NEAR-TERM OUTLOOK – NEUTRAL TO NEGATIVE.


US DOLLAR – The Pound Dollar exchange rate (GBP/USD) is 1.6122

Republican law-makers are expected to stand against President Obama’s Democrats today and vote in favour of massive spending cuts in order to tackle the US’s massive deficit. With action needed before the 2nd August deadline for the US to avoid a catastrophic debt default, the Republicans’ continued brinkmanship is likely to cause selling pressure on the Dollar. NEAR-TERM OUTLOOK – NEUTRAL.


EURO – The Pound Euro exchange rate (GBP/EUR) is 1.1397

July’s ZEW Index, released this morning, showed that German investor confidence contracted by more than analysts had anticipated over the last month, suggesting that fears over the ongoing Eurozone debt crisis are weighing heavily on the minds of market participants in the Europe’s leading economy. With ECB Governing Council member, Ewald Nowotny, publicly discussing plans for a managed ‘selective default’ by Greece, the Euro remains in danger. NEAR-TERM OUTLOOK – NEUTRAL TO NEGATIVE.


AUSTRALIAN DOLLAR – The Pound Australian Dollar exchange rate (GBP/AUD) is 1.5109


Last night’s Reserve Bank of Australia Minutes painted a gloomy picture of the prospects for a continuation of the global economic recovery, stating that the chances of a fully-blown Eurozone debt crisis have escalated over the last month. The minutes stuck a dovish tone on domestic monetary policy, calling for a ‘wait and see’ policy on inflation, but the Aussie has avoided significant losses so far today, as global equities claw back lost ground. NEAR-TERM OUTLOOK – NEUTRAL TO NEGATIVE.


SINGAPORE DOLLAR – The Pound Singapore Dollar exchange rate (GBP/SGD) is 1.9601

Singaporean data releases have been of a softer tone than analysts had anticipated during recent sessions, with this week’s trade figures showing that the value of goods exported by Singapore’s companies has hardly increased over the last twelve months. Concerns over the strength of Singapore’s real economy have caused economists to downgrade their expectations of a near-term tightening of monetary policy by the Monetary Authority of Singapore. NEAR-TERM OUTLOOK – NEUTRAL TO NEGATIVE.


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