Foreign Exchange Rates : Currency Predictions - GBP, USD, EUR, AUD, CHF, SGD

June 15, 2011 - Written by John Cameron

STORY LINK Foreign Exchange Rates : Currency Predictions - GBP, USD, EUR, AUD, CHF, SGD

POUND STERLING

UK job market data released this morning sent out mixed messages about the state of the real economy in the UK. On the one hand, the figures showed that UK Unemployment dropped by its largest quarterly amount since 2000. However, the numbers also showed a much larger than anticipated monthly increase in the number of people claiming unemployment benefit in the UK in May. Sterling has lost ground against most of the other majors as a consequence. NEAR-TERM OUTLOOK – NEUTRAL.


US DOLLAR – The Pound Dollar exchange rate (GBP/USD) is 1.6248

Federal Reserve Chairman Ben Bernanke’s comments last night have caused the Dollar to strengthen against the Pound and the Euro on the day. Bernanke warned that unless warring factions in the US Congress reached an agreement on raising the US’s Debt Limit, then the Dollar risked losing its status as a reserve currency. Meanwhile, in the near-term, soft economic data from Japan and Australia and S&P’s downgrade of its outlook for China’s property market, have caused support for the Greenback. NEAR-TERM OUTLOOK – NEUTRAL TO POSITIVE.


EURO – The Pound Euro exchange rate (GBP/EUR) is 1.1374

This morning’s whole-of-Eurozone Industrial Production figures for April outstripped analysts’ expectations, reminding investors that Europe’s real economy continues to perform well, in spite of ongoing sovereign debt concerns. However, the data has failed to push the Euro higher as investors continue to fret about Eurozone Finance Ministers’ ongoing failure to agree on the terms of a second Greek bail-out. NEAR-TERM OUTLOOK – NEUTRAL TO NEGATIVE.


AUSTRALIAN DOLLAR – The Pound Australian Dollar exchange rate (GBP/AUD) is 1.5238

Comments made by Glenn Stevens, the Governor of Australia’s central bank, during last night’s Asian session, have elicited strong support for the Australian Dollar on the day. Stevens stated that interest rates will need to rise in order to cool inflationary pressures in Australia’s economy. Much better than anticipated Australian Dwelling Starts data for Q1, released overnight, has further helped the Aussie. NEAR-TERM OUTLOOK – NEUTRAL TO POSITIVE.


SWISS FRANC – The Pound Swiss Franc exchange rate (GBP/CHF) is 1.3827

Monthly Swiss Producer & Import Price data, released earlier today, showed a surprise dip in domestic price inflation. However, the Franc has held its own in the markets today as renewed fears over the viability of a second Greek bail-out have caused the Franc to benefit from its reserve currency status. NEAR-TERM OUTLOOK – NEUTRAL TO POSITIVE.


SINGAPORE DOLLAR – The Pound Singapore Dollar exchange rate (GBP/SGD) is 2.0060

The latest Inflation figures issued by the Monetary Authority Policy showed that price rises in Singapore are coming under control, with the headline CPI figure dropping from 5.5% down to 4.5% in the first quarter of 2011. With the MAS’s recent tightening of domestic monetary policy apparently having the desired effect, it seems likely that interest rates will stay on hold until the Autumn, at least. NEAR-TERM OUTLOOK – NEUTRAL TO POSITIVE.


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