Forex Forecast : Rate Predictions For GBP, USD, EUR, AUD, CAD, JPY

May 25, 2011 - Written by John Cameron

STORY LINK Forex Forecast : Rate Predictions For GBP, USD, EUR, AUD, CAD, JPY

POUND STERLING

This morning’s revised UK GDP figures for Q1 came in ‘on expectations’, but UK Q1 Export figures released at the same time exceeded analysts’ expectations. A lower level of UK domestic imports in the first quarter suggests that the BoE’s tacit policy of weakening the Pound appears to be working. NEAR-TERM OUTLOOK – NEUTRAL TO POSITIVE.


US DOLLAR – The Pound Dollar exchange rate (GBP/USD) is 1.6269

A slight improvement in global appetite for risk has caused a softening of the Dollar during today’s session. A very poor US Durable Goods figure released this afternoon has not helped the Greenback but fears regarding the Eurozone sovereign debt crisis could take the Dollar higher at any given time. NEAR-TERM OUTLOOK – NEUTRAL TO NEGATIVE.


EURO – The Pound Euro exchange rate (GBP/EUR) is 1.1543

The Irish Prime Minister called for interest rates to be eased on the bail-out loans that Ireland has received from the EU and IMF earlier today, causing jitters for investors holding Euro-denominated assets. Eurogroup leader Jean-Claude Juncker stated that a ‘reprofiling’ of Greece’s debt might not be enough to save the stricken state from default. Together these comments caused significant downside for the Euro. NEAR-TERM OUTLOOK – NEUTRAL TO NEGATIVE.


AUSTRALIAN DOLLAR – The Pound Australian Dollar exchange rate (GBP/AUD) is 1.5460

The Australian Dollar weakened throughout today’s session to trade down by almost 1% against the Pound. This morning’s report from the OECD which predicted lower levels of global economic growth this year than last and raised the possibility of ‘stagflation’ in the world’s major economies has further hurt the Aussie. NEAR-TERM OUTLOOK – NEUTRAL TO NEGATIVE.


CANADIAN DOLLAR – The Pound Canadian Dollar exchange rate (GBP/CAD) is 1.5896

The weak tone of recent economic data releases emanating from Canada continues to suppress expectations for Canadian Dollar interest rates. Volatility in crude oil prices, which many analysts suggest signifies a that a top has been reached, continues to weigh down the CAD. NEAR-TERM OUTLOOK –NEAGTIVE.


JAPANESE YEN – The Pound Japanese Yen exchange rate (GBP/JPY) is 133.46

Last night’s Japanese Trade Balance figures came out better than analysts had anticipated but the Yen lost ground on the day, trading 0.65% down against GBP. Fears over the Japanese economy’s ability to recover from the devastation of the recent Tsunami continue to hold back the Yen, as does the general forward movement in global appetite for risk over recent months. NEAR-TERM OUTLOOK – NEGATIVE.

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