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

Published: Tuesday, 7 February 2012 18:00 BST - Written by John Cameron

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

POUND STERLING

The Pound has had a ‘middle of the road’ day, registering small gains against the North American currencies, but losing ground against the euro and the high-yielders. There were no tier one UK data releases to provide impetus for the Pound, but a report from Ernst & Young’s ITEM Club predicting that lending by the UK’s banks would contract this year was unhelpful. NEAR-TERM OUTLOOK – NEUTRAL.


US DOLLAR – The Pound Dollar exchange rate (GBP USD) is 1.5897

The Greenback has come under selling pressure during this afternoon’s session. Federal Reserve Chairman Ben Bernanke spoke and the markets listened – Bernanke’s assertion that the Fed would maintain a ‘balanced approach’ sent out a pro-growth message, improving investor sentiment and weakening the safe-haven US Dollar. NEAR-TERM OUTLOOK – NEUTRAL TO NEGATIVE.


EURO – The Pound Euro exchange rate (GBP EUR) is 1.1991

The euro has seen sustained support during this afternoon’s session, as speculators adjusted their positions to factor-in a widely-anticipated positive vote from Greece’s parliament on the country’s next round of austerity measures. However, euro-positivity may be short-lived, as this morning’s highly disappointing German industrial production data for December provides a grim back-drop for Europe’s single currency. NEAR-TERM OUTLOOK – NEUTRAL TO POSITIVE.


AUSTRALIAN DOLLAR – The Pound Australian Dollar exchange rate (GBP AUD) is 1.4716


The Australian Dollar has surged since last night’s surprise decision by the Reserve Bank of Australia to keep its key lending rate on hold at 4.25%. This has seen the GBP AUD exchange rate plummet to 1.4618, its lowest level for over two decades. As ever, a default by Greece could de-rail the Aussie bandwagon – all in all, a great time to be selling AUD. NEAR-TERM OUTLOOK – NEUTRAL TO POSITIVE.


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