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

Published: Friday, 10 February 2012 16:00 BST - Written by John Cameron

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

POUND STERLING

This morning’s UK factory gate price figures showed at a higher level than had been anticipated. The Producer Price Index figures are viewed as a leading indicator of inflation, raising the possibility that the Bank of England may need to consider raising base rate sooner rather than later. Sterling has held steady ahead of this week’s market close. NEAR-TERM OUTLOOK – NEUTRAL.


US DOLLAR – The Pound Dollar exchange rate (GBP USD) is 1.5756

This afternoon’s US trade numbers for December showed that the trade deficit in the world’s largest economy is widening. The major driving factor behind this is the record level of imports which Americans consumed the month before last. The Dollar has strengthened on the day due to the return of a ‘risk-off’ trading environment – the longer Greek politicians procrastinate on an austerity deal, the more likely the Greenback is to win further support. NEAR-TERM OUTLOOK – NEUTRAL TO POSITIVE.


EURO – The Pound Euro exchange rate (GBP EUR) is 1.1947

Greek demonstrations against the austerity measures which the eurozone is attempting to impose on the country, once again turned violent earlier today. The proposed austerity package will see 15,000 public sector workers lose their jobs and the country’s minimum wage being slashed by over 20%. Something has to give at some stage for the debt-addled Hellenic state – in the mean time, the euro trades sideways against the other majors and braces itself. NEAR-TERM OUTLOOK – NEUTRAL.


NEW ZEALAND DOLLAR – The Pound New Zealand Dollar exchange rate (GBP NZD) is 1.9038


The Kiwi Dollar’s bull-run against Sterling appears to have hit the bricks over the past 48hrs as appetite for risk has drained from global markets. The risk-sensitive NZD has come under selling pressure as investors seek out a safe haven in anticipation of more bad news from Greece’s ongoing debt discussions. Last night’s better than anticipated NZ Card Spending figures offer some hope for New Zealand’s future economic prospects. NEAR-TERM OUTLOOK – NEUTRAL TO NEGATIVE.


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