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

Published: Wednesday, 17 August 2011 14:11 BST - Written by John Cameron

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

POUND STERLING

The release of the minutes of this month’s Bank of England Monetary Policy Committee meeting provided a big surprise for analysts earlier today, revealing that for the first time this year, all nine members of the committee voted to hold rates at 0.5%. Unemployment figures also released this morning rubbed salt into the UK economy’s wounds, with British unemployment showing an unexpected rise in the three months to June. NEAR-TERM OUTLOOK – NEGATIVE.


US DOLLAR – The Pound Dollar exchange rate (GBP/USD) is 1.6495

US Producer Price Index data released a short time ago showed that input costs for American manufacturers are increased at a faster pace in July than in June. However, the Federal Reserve’s assertion last week that US interest rates would remain at their current record low range until 2013 at least, limits the effect that such data has on the Dollar. Meanwhile, the Greenback is maintaining a weakening bias as global stocks shore up. NEAR-TERM OUTLOOK – NEUTRAL TO NEGATIVE.


EURO – The Pound Euro exchange rate (GBP/EUR) is 1.1383

Support for the Euro has been limited throughout today’s session, as global markets digest yesterday’s joint press conference between German Chancellor Angela Merkel and France’s President Sarkozy. The proposed tax on financial transactions has particularly spooked the markets, leading Eurozone equities indices lower. NEAR-TERM OUTLOOK – NEUTRAL TO NEGATIVE.


AUSTRALIAN DOLLAR – The Pound Australian Dollar exchange rate (GBP/AUD) is 1.5601


A mixed performance for global stocks over the last 24 hours has led to indecision from investors holding Australian Dollars. The failure of yesterday’s summit between the French and German leaders to deliver a tangible solution for the Eurozone’s debt crisis could be bad news for the Aussie if it causes the markets to take fright. NEAR-TERM OUTLOOK – NEUTRAL.


HONG KONG DOLLAR – The Pound Hong Kong Dollar exchange rate (GBP/HKD) is 12.8520

The Hong Kong Dollar has gradually weakened over the past week thanks to its status as a Dollar-pegged currency. This weakening has coincided with an improvement for global equities markets following their collapse in the early part of August. The Hang Seng share index in Hong Kong out-performed most Asian stock markets last night following the announcement of policies to increase Hong Kong’s global competitiveness. NEAR-TERM OUTLOOK – NEUTRAL TO NEGATIVE.


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