Foreign Currency Exchange Rate Prediction For GBP EUR And Forecasts For USD & NOK

Published: Tuesday, 22 January 2013 14:00 BST - Written by John Cameron

STORY LINK Foreign Currency Exchange Rate Prediction For GBP EUR And Forecasts For USD & NOK

This morning’s UK public sector borrowing data for last month showed at a higher level than expected, raising concerns that Britain may be about to relinquish its AAA credit rating. The POUND STERLING slumped against the other major global currencies following the release. With Friday’s UK Q4 GDP data expected to disappoint, the outlook for the Pound in the short term is NEUTRAL TO NEGATIVE.

The US DOLLAR has put in a meek performance in the currency markets so far today. The Greenback has lost ground following last night’s announcement from Japan’s policymakers that they are set to double their nation’s inflation target and further ease domestic monetary policy. Although global share markets have held steady so far today, an increased willingness from investors to hold risk-laden assets has hurt the safe-haven Buck. Because of this, the Dollar is expected to trade on a NEUTRAL TO NEGATIVE footing in the near term.

This morning’s announcement from the EU Finance Ministers’ summit in Brussels that 11 member states will be introducing a tax on financial transactions has so far failed to help the EURO. In spite of a slightly better than expected German ZEW index, released earlier, fears that the so-called ‘Tobin Tax’ will take a toll on inward investment into the eurozone have held back the single currency. The current GBP EUR exchange rate stands at 1.1915 and the euro is expected to trade with a NEUTRAL bias moving forward.

The NORWEGIAN KRONE has suffered a pronounced wobble during the early part of this week’s session thanks to concerns that Norway’s government bonds may not be the safe-haven cash cow which they were previously considered to be. The change came after S&P placed long term Norwegian gilts on CreditWatch. The current GBP NOK exchange rate stands at 8.8750 and the outlook for the Krone is NEUTRAL TO NEGATIVE.

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