Pound To US Dollar Exchange Rate (GBP USD) Falls, GBP EUR Rate Forecast To Accumulate

Modified: Tuesday, 14 May 2013 08:58 BST - Written by John Cameron

STORY LINK Pound To US Dollar Exchange Rate (GBP USD) Falls, GBP EUR Rate Forecast To Accumulate

The US Dollar continued its near-term renaissance during yesterday’s session in the currency markets, gaining ground against virtually all of the sixteen most actively traded currencies. The Greenback started the day on the front foot thanks to reports in the States that the US Federal Reserve had formulated a road map which would see it wind down its highly controversial Quantitative Easing programme which has artificially subdued the Buck for several years.

The forward move for the US Dollar was further fuelled by yesterday afternoon’s US Advance Retail Sales data which showed that shop sales in the world’s premier economy had unexpectedly increased last month. Analysts had been expecting a reduction of 0.3% in the figure, so in a clear case of ‘buy on the rumour, sell on the news’, the US Dollar hovered up support post-release, as investors increased their bets that the QE era is drawing to a close in the States. The news saw the Pound to US Dollar exchange rate (currency : GBP USD) smash down through the 1.5300 level as the European equities session drew to a close.

Looking ahead to today’s session, the major data release of the day comes later this morning in the form of this month’s ZEW Sentiment Survey in Germany. As long as the German economy continues to perform, investors are able to remain sanguine about the future prospects for the single currency. However, a weak showing for the key gauge of German confidence would surely send the Pound to Euro exchange rate (currency : GBP EUR) back up through its key resistance level at 1.1900. Consecutive closes above this rate would send out a strongly bullish signal for the pair moving forward. German GDP figures, due out on Wednesday morning, will provide the pair with further direction – a showing of below the annualised 0.2% annualised figure would trigger further upside for GBP EUR.

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TAGS: American Dollar Forecasts Daily Currency Updates Dollar Po Forecasts