Foreign Exchange Rates : Currency Predictions - GBP, USD, EUR, TRY

December 5, 2011 - Written by John Cameron

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

POUND STERLING

Today’s PMI Services Sector survey showed a pick-up in activity in this key sector of Britain’s economy, providing a welcome fillip for the Pound. Wednesday’s UK Industrial and Manufacturing numbers may not be so encouraging – investors holding Sterling assets should make hay while the sun shines. NEAR-TERM OUTLOOK – NEUTRAL TO POSITIVE.


US DOLLAR – The Pound Dollar exchange rate (GBP USD) is 1.5698

After last week’s rally in global stocks, which saw indices on both sides of the Atlantic gain over 7%, there were further gains for stock markets today. This has caused downside pressure on the Greenback, with the potential for further losses as the week goes on, if Eurozone leaders continue to talk tough on the Eurozone’s future. NEAR-TERM OUTLOOK – NEUTRAL TO NEGATIVE.


EURO – The Pound Euro exchange rate (GBP EUR) is 1.1662

The Franco-German emergency summit held in Paris today, has lead to a joint statement from French President Nicolas Sarkozy and German Chancellor Angela Merkel calling for a the new Eurozone treaty. This could be easier said than done, as all 27 members of the Eurozone will have to provide their consent for such a change. The market’s instant reaction to the news was Euro-negative, reflecting these doubts. NEAR-TERM OUTLOOK – NEUTRAL.


NEW TURKISH LIRA – The Pound New Turkish Lira exchange rate (GBP/TRY) is 2.8714

The Lira has come under heavy selling pressure during today’s session, following the release of domestic inflation numbers which showed that prices are rising at their fastest rate for almost two years. It appears that the Turkish central bank’s action to weaken the Lira is causing Turkey’s delicate economy to ‘import inflation’, as the price of imported goods spirals in Turkey’s home market. Turkish policy-makers are now boxed into a corner – this is bad news for investors holding Lira-denominated assets. NEAR-TERM OUTLOOK – NEUTRAL TO NEAGTIVE.


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