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

June 24, 2011 - Written by John Cameron

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

POUND STERLING

The Pound has done little more than hold its own against the other majors today as market participants focussed on events elsewhere. With no data released in the UK today, a positive move for the FTSE 100 equities index was cancelled out by expectations that a Bank of England interest rate rise is many months away yet. NEAR-TERM OUTLOOK – NEUTRAL TO NEGATIVE.


US DOLLAR – The Pound Dollar exchange rate (GBP/USD) is 1.6005

The Dollar has softened throughout the day as institutional investors reversed their positions of safety in US treasury bills thanks to a pick-up in global risk appetite. With positive news emanating from the Eurozone, it is possible that the GBP USD rate has seen a key reversal and is set to remain above the key 1.60 level. NEAR-TERM OUTLOOK – NEUTRAL TO NEGATIVE.


EURO – The Pound Euro exchange rate (GBP/EUR) is 1.1271

This morning’s German IFO Business Climate Survey far exceeded expectations, but the major development in the Eurozone over the last twenty-four hours came with last night’s announcement that Eurozone leaders have reached an agreement to provide a second bail-out, totalling €120bn for Greece via the European Financial Stability Facility. Investor’s thoughts are now likely to return to relative yields, which benefits the Euro over the Dollar and Sterling. NEAR-TERM OUTLOOK – NEUTRAL TO POSITIVE.


AUSTRALIAN DOLLAR – The Pound Australian Dollar exchange rate (GBP/AUD) is 1.5171

The Australian Dollar has outperformed the other majors on the day thanks to improved appetite for risk in global markets. The agreement of a second Greek bail-out has certainly helped the situation, but soft Australian data releases in recent weeks and the potential for slower global growth in the latter half of 2011 could halt the Aussie’s progress. NEAR-TERM OUTLOOK – NEUTRAL.


CANADIAN DOLLAR – The Canadian Dollar exchange rate (GBP/CAD) is 1.5712

The Canadian Dollar has edged lower against the Pound during today’s session, with the GBP CAD rate edging back above 1.5700 during Europe’s afternoon session. The Canadian Dollar has acted as a barometer for the health of the global economy in recent months and recent soft data releases across the world and Fed Chairman Ben Bernanke’s negative assessment of the global economy at his Wednesday press conference have hurt the CAD more than most. Yesterday’s sharp drop in crude oil prices has further hindered the Canadian Dollar. NEAR-TERM OUTLOOK – NEUTRAL TO NEGATIVE.


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