FX Forecast: Euro, Pound Sterling, Aus, NZ and US Dollar Exchange Rate Predictions & EUR GBP AUD NZD USD Outlook

September 5, 2014 - Written by John Cameron

STORY LINK FX Forecast: Euro, Pound Sterling, Aus, NZ and US Dollar Exchange Rate Predictions & EUR GBP AUD NZD USD Outlook

Currency News UK presents our Exchange Rate Forecasts for the Euro, Pound Sterling, Aus, NZ and US Dollar and Exchange Rate Predictions for EUR GBP AUD NZD USD - Studying historical data from the past seven decades, analysts have found that the average stock market ‘Bull Run’ lasts for 60 months. The current forward move for global equities began some 65 months ago, leading many investors to express their fears that stock markets may now be due a major correction.

However, these doubters were provided with a sizable shot of reassurance by the European Central Bank yesterday with the announcement that the euroland reserve lender would be introducing its own Quantitative Easing programme, beginning next month. The details of the programme remain to be thrashed out, with next month’s ECB policy announcement bringing further information, however the scheme will inevitably involve the buying-up of sovereign debt on a massive scale. The programme is likely to have a pronounced effect on the world’s major currencies – our analysts delve into the forecasts for the EURO (currency:EUR), AUSTRALIAN DOLLAR (currency:AUD), NEW ZEALAND DOLLAR (currency:NZD), CANADIAN DOLLAR (currency:CAD) and US DOLLAR (currency:USD).

The EURO (currency:EUR) is likely to be heavily down-sold in the wake of yesterday’s announcement from the European Central Bank. The US Federal Reserve led the way with QE shortly after the global financial crisis broke in 2008 and the US DOLLAR (currency:USD) suffered hefty losses in the market as a result. The Bank of England followed in the Fed’s footsteps a short time afterwards and the Pound Sterling slumped. It would appear highly likely that the single currency will go the same route as Sterling and the Buck; expect the Pound euro exchange rate top threaten its 6-year high of 1.2894 sooner rather than later.

The AUSTRALIAN DOLLAR (currency:AUD), NEW ZEALAND DOLLAR (currency:NZD) and CANADIAN DOLLAR (currency:CAD) are often grouped together as the ‘Commodity Dollars’ due to their risk-sensitive characteristics and the dependence upon export markets by the economies which they are attached to. The trio usually move in synch with each other and most analysts now agree that, with the ECB’s announcement of yesterday, their likely direction of travel will now be forward into the short-to-medium term. Market participants agree that the ultra-loose monetary policy from the ECB will maintain buoyant levels of risk appetite in the markets into the medium term, so positive movement is forecast for AUD, NZD and CAD.

The US DOLLAR (currency:USD) is expected to register healthy gains against the euro into the long term following yesterday’s development. The euro US Dollar (EUR/USD) remains the world’s number one currency pair, comprising around 70% of the volume transacted in the global currency markets on a daily basis according to a recent study from the World Bank. With the single currency likely to ship support, the Buck will benefit and the gains it registered will be replicated against the other sixteen most actively traded global currencies. Analysts forecast that the Greenback could be the big winner from the ECB’s announcement of QE.

International Money Transfer? Ask our resident FX expert a money transfer question or try John's new, free, no-obligation personal service! ,where he helps every step of the way, ensuring you get the best exchange rates on your currency requirements.

TAGS: American Dollar Forecasts Australian Dollar Forecasts Canadian Dolla Forecasts