Currency News FX Outlook for GBP CAD NOK CHF JPY USD

August 11, 2016 - Written by Ben Hughes

STORY LINK Currency News FX Outlook for GBP CAD NOK CHF JPY USD

Oil Price Drop Sends Canadian Dollar (CAD), Norwegian Krone (NOK) Exchange Rates Lower

Not for the first time in recent months, yesterday afternoon’s weekly US Oil Inventory data sent the price of a barrel of ‘Black Gold’ significantly lower; analysts had been pricing-in a smaller increase than the 2.5 m jump in American oil stocks which the official Energy Information Administration statistic pointed to.

The result, which took the total level of US oil inventories to a whopping 1.39 bn barrels, sent the price of a barrel of Brent Crude down from close to the $46 level into the lower part of the $44s and had the additional effect of triggering a sharp bout of selling pressure on the oil-driven Canadian Dollar (currency : CAD) and Norwegian Krone (currency : NOK).

Pound Sterling Not Forecast to Fall Further Vs CAD, NOK

Gene McGillian , an analyst at Tradition Energy in the US, assessed the numbers and made a prediction that,

‘If we don’t start to see some inroad into this overhang of storage, the market’s going to have a hard time getting back to our recent highs.’

If Mc Gillian’s forecast proves correct and the price of a barrel of Brent Crude does indeed hold below the $50 level, then it appears possible that both the GBP CAD and the GBP NOK exchange rate have bottomed out in the near-term.

GBP/CHF Exchange Rate Drops to Low of 1.26

Elsewhere, the Swiss Franc (currency : CHF) was yesterday’s best-performing currency against the Pound Sterling, with the GBP CHF exchange rate dropping to an intraday low of 1.2679 late on in the European session. The move into the ultra low-yielding safe haven Franc from institutional investors suggests that they fear an economic storm brewing on the horizon and the strong performance from its sister Asian currency, the safe haven Japanese Yen (currency : JPY), during recent sessions, confirms this.

Looking ahead, today’s session brings a relatively light global data schedule, with the highlight coming in the form of the weekly US jobs data in the US. Another strong set of numbers, building on last Friday’s stellar US Non-Farm Payroll data is forecast to bring further downward movement for the Pound Dollar exchange rate.

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