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Scottish Referendum & Sterling Forecasts - Pound Euro and US Dollar Exchange Rate Predictions 2014 /2015

September 17, 2014 - Written by John Cameron

Currency News UK 2014/2015 - Scottish Referendum Forecast and the Sterling: A stronger Pound to Euro and US Dollar Exchange Rate as GBP Rallies

Analysts forecast that a dovish commentary from the US Federal Reserve will send the Pound to Dollar exchange rate GBP/USD sharply higher. Meanwhile, the Scottish referendum has led investors to predict renewed gains for the Pound.

This afternoon’s US Consumer Price Inflation numbers came in at well below analysts’ expectations at a year-on-year 1.7% versus analysts’ expectations of a 1.9% showing.

The pronounced drop from the counterpart July print of 2.0% takes the pressure off the Federal Reserve to raise interest rates, so the Pound US Dollar exchange rate climbed to as high as 1.6358 GBP/USD in response.

Investors won’t have to wait long until they find out about the Fed’s near-term intentions – the US central bank’s next policy announcement comes at 1900hrs this evening and is immediately followed by Chair Janet Yellen’s press conference.

At the start of this week, the bulk of analysts were tipping Yellen to drop her previous advice that the Fed would be maintaining its interest rates at their current ultra-low level for a ‘considerable time’.

Following this afternoon’s monthly price rise figures, the same analysts are now not so sure. Expect the GBP USD rate to continue to track Northwards if Yellen perseveres with her ‘considerable time’ guidance.

Looking ahead, the next 24hrs are likely to key defining for the Pound Sterling New Zealand Dollar exchange rate, which is currently pushing towards the two to one threshold GBP NZD.

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This evening’s Kiwi Gross Domestic Product numbers are expected to reveal that the New Zealand economy expanded at an annualised rate of 3.8% during the three months to the end of June.

Anything below this and the GBP NZD exchange rate is likely to climb back above two to one.

Meanwhile, the major risk event for the remainder of the week as far as Sterling-holders are concerned comes in the form of tomorrow’s much-anticipated Scottish independence referendum.

Three polls published within the past 24hrs have suggested that the likely vote split is 52 / 48 in favour of the ‘No’ campaign.

Such an outcome would cause a pronounced relief rally for Sterling against all of the other sixteen most-actively traded global currencies, sending the Pound euro exchange rate up to a fresh 25-month high in the 1.2700s.

The Pound US Dollar exchange rate would be likely to track higher towards the 1.7000 threshold once more GBP USD.

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