Pound Sterling Exchange Rate Forecast vs Euro, US Dollar & Canadian Dollar

September 9, 2016 - Written by John Cameron

STORY LINK Pound Sterling Exchange Rate Forecast vs Euro, US Dollar & Canadian Dollar

Pound Sterling (GBP) Exchange Rate Forecast Neutral-Negative

Although Pound Sterling (GBP) exchange rates are down from the week's highest levels, the currency was still able to register modest gains on Friday and looks sent to enter the weekend standing firm against the Euro (EUR), US Dollar (USD) and Canadian Dollar (CAD).

The POUND STERLING (currency : GBP) suffered some selling pressure during early trading today as market participants factored-in weaker than expected UK Trade Balance data which revealed a monthly surplus of imports over exports of some £4.5 bn. Monday’s encouraging PMI survey of the British services sector could favour the Pound in the short to medium term, so the Sterling forecast is NEUTRAL TO NEGATIVE.

German Trade Data See Euro (EUR) Exchange Rates Reverse ECB Inspired Gains

Euro (EUR) exchange rates surged on Thursday after the European Central Bank (ECB) opted to leave stimulus unchanged, but the latest German figures took the shine off the currency's uptrend on Friday.

The EURO (currency : EUR) was slightly hindered by this morning’s disappointing German Trade Balance figures. The July result of GBP19.5 bn represented a pronounced dip from August’s showing of EUR24.7 bn, but was still enough to see the shared currency perform steadily on the day. Yesterday’s assertion from the European Central Bank that its policy board is not considering an extension to Quantitative Easing could help the euro moving forward and the outlook for the single currency is NEUTRAL TO NEGATIVE – the GBP EUR exchange rate stands at 1.1838.

US Dollar Exchange Rates Firm on Prospect of 2016 US Rate Hike, GBP/USD Holding 1.33

Recent US reports may have provided cause for concern but the US Dollar to Pound (USD/GBP) and US Dollar to Euro (USD/EUR) exchange rates have proven resilient.

The US DOLLAR (currency : USD) continues to benefit from the belief amongst investors that there’s a live chance the Federal Reserve will hike US interest rates later this month. Futures markets imply a 30% chance of such an action for 21st September, with a 62.5% likelihood that the cost of borrowing Stateside will be higher before the end of the year. The Buck is therefore forecast to trade on a NEUTRAL TO POSITIVE footing in the near-term and the GBP USD exchange rate stands at 1.3306.

Neutral-Negative Outlook for Canadian Dollar (CAD) Exchange Rates

Fluctuating oil prices have been the cause for most of the recent movement in Canadian Dollar (CAD) exchange rates.

But strong domestic job creation data, out this afternoon, has failed to help the CANADIAN DOLLAR (currency : CAD) improve against the Pound. The official stats showed that 26,200 new positions were generated last month but investors chose instead to focus on the recent downbeat tone of the Bank of Canada’s rhetoric. The outlook for the Loonie is NEUTRAL TO NEGATIVE and the GBP CAD exchange rate stands at 1.7298.

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TAGS: Currency Predictions Dollar Pound Forecasts Euro Forecasts Pound St Forecasts