October 17, 2014 - Written by John Cameron
STORY LINK Pound Sterling Forecasts 2015 - GBP Exchange Rate Losses Predicted on BoE Comments
Share markets have remained edgy last week, leading exchange rate analysts to forecast further volatility to come for the Australian Dollar (currency:AUD), New Zealand Dollar (currencyNZD) and South African Rand (currency:ZAR) conversion rates.
Meanwhile, Sterling-watchers predict that this morning’s comments from a key player at the Bank of England may send the Pound lower in the medium term.
So far today the GBP rates look like this (updated 12:55PM 17/10/2014):
The Pound to Australian Dollar conversion rate is -0.04 pct lower at 1.83456 GBP/AUD.
The Pound to Canadian Dollar exchange rate today is converting -0.15 per cent lower at 1.80997 GBP/CAD.
The Pound to Euro exchange rate today is converting -0.03 per cent lower at 1.25662 GBP/EUR.
The Pound to New Zealand Dollar exchange rate converts +0.01 per cent higher at 1 GBP is 2.02663 NZD.
The Pound to US Dollar exchange rate converts +0.14 per cent higher at 1 GBP is 1.61190 USD.
The Pound to South African Rand conversion rate is -0.09 pct lower at 17.85769 GBP/ZAR.
Don't forget if you are waiting to find the best exchange rate for a currency transfer, then you're best bet is to set up your future rate order with a foreign exchange broker! Pound climbs vs Aus, NZ and Canadian Dollar
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The CBOE VIX index, widely labelled the ‘Fear Index’, spiked to well above the 25.0 level - its highest reading for some months - during trading yesterday.
The move hinted that investors were now beginning to move into all-out panic mode. The result could bring a wholesale shift out of risk-laden assets – a development which would be likely to send the Pound Sterling (GBP) spiralling against the Commodity Dollars, propelling the Pound to Australian Dollar (AUD), New Zealand Dollar (NZD) and Canadian Dollar (CAD) exchange rates sharply Northwards.
Poor US Data Weighs On US Dollar Elsewhere, the mood in the United States remains subdued as market participants continue to take stock of the news that a second American had contracted the deadly Ebola virus in Texas.
The poor domestic retail sales data, published midweek, added to the mood of gloom which was engendered by the Federal Reserve’s completion of its tapering of Quantitative Easing this month.
The latest edition of the Fed’s Beige Book, published on Wednesday evening, didn’t help matters, revealing that half of the US central bank’s twelve regions had reported ‘modest’ levels of growth, while five others described activity levels as only ‘moderate.’
US shares and the
US Dollar slumped as a result, propelling the GBP/USD back above the 1.6000 threshold yesterday.
Pound and Euro to Dollar Exchange Rate Forecast Today: Further Losses For USD
Michael Hewson, chief market analyst at CMC Markets, summed up the mood yesterday, stating that, ‘as the monetary morphine has started to wear off the patient has come to realise that a lot of the old problems still remain, and yesterday's poor US data helped trigger a rather extreme reaction in not only the stock markets but bond markets too, as complacent investors rushed to hedge themselves.
In essence, investors are asking the question with respect to the recent recovery about whether this is as good as it gets, which rather explains the slump in the oil price, bond yields and stock markets.’
Bank of England Warning Hurts Pound Sterling Meanwhile, Bank of England Chief Economist
Andy Haldane had some Sterling-negative comments to make earlier this morning.
He stated that he was now gloomier than before about the future of the UK economy thanks to fears of a slowdown in the eurozone.
He also suggested that UK interest rates will remain at their current record low for a longer period than was previously expected.
These comments are likely to hinder Sterling during coming months.
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