Foreign Exchange Rates : Weak US Data Causes Gains For GBP USD, While GBP EUR Remains Under Pressure

May 20, 2011 - Written by John Cameron

STORY LINK Foreign Exchange Rates : Weak US Data Causes Gains For GBP USD, While GBP EUR Remains Under Pressure

The Pound Euro exchange rate (GBP EUR) is 1.1338. The Pound Dollar exchange rate (GBP USD) is 1.6229. The Pound Australian Dollar exchange rate (GBP/AUD) is 1.5215.

For the second time during this week’s trading, the Pound failed to gain ground against the other majors following the release of apparently positive UK data during yesterday’s session.

This time the figure in question was the UK Retail Sales number for April, which printed at an annualised 1.1% versus expectations of 0.8%.

As with Tuesday’s better-than-expected UK Inflation data, the Pound made gains in the immediate aftermath of the release of the Retail Sales figure, with the GBP EUR rate climbing to 1.1374 within thirty minutes of the release.

However, Sterling failed to cling on to these gains, with GBP EUR trading all the way down to 1.1305 late yesterday as the prevalent downtrend re-established itself.

Analysts have pointed to Sterling’s apparent inability to gain ground in spite of positive UK data as a sign that market sentiment towards the Pound is at a low ebb, suggesting that when a worse-than-anticipated set of UK economic figures is released, Sterling may experience a heavy sell-off.

The Pound performed with more resilience against the USD yesterday, with the GBP USD rate recovering from an intra-day low of 1.6131 to trade up by over a cent at one point during the afternoon session.

Gains for GBP USD were largely caused by US Dollar weakness which was brought on by worse-than-expected US housing sector and leading indicator data. Combined with a disappointing Philadelphia Fed Survey and the S&P 500 struggling to close just 2.92 points up on the day yesterday, further upside is possible for the GBP USD pair during today’s session.


For other live currency exchange rates and a currency converter see the currency news website.

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 Daily Currency Updates Euro Forecasts Pou Forecasts