Foreign Currency Exchange Rate Forecast For EUR GBP And Predictions For USD & NZD

Published: Thursday, 14 February 2013 14:00 BST - Written by John Cameron

STORY LINK Foreign Currency Exchange Rate Forecast For EUR GBP And Predictions For USD & NZD

The POUND STERLING has traded on a neutral footing so far today, gaining ground against the euro, but losing out to the commodity-driven high-yielders. With very little in the way of risk events to budge the Pound for the rest of today, it is anticipated that Sterling will trade with a NEUTRAL bias ahead of tomorrow morning’s UK retail sales data for January.

The EURO has endured a pronounced bout of selling pressure so far today following weak French, German and whole of eurozone GDP data. The region-wide GDP data was particularly worrying for investors holding euro-denominated assets, revealing that the economy in mainland Europe had contracted by almost 1% during the final three months of last year. The current GBP EUR exchange rate is 1.1636 and the outlook for the single currency is NEUTRAL TO NEGATIVE.

The US DOLLAR continues to perform strongly in the currency markets, sending the GBP USD exchange rate down as low as 1.5489 earlier. The ‘Buck’ has benefitted from a tame performance for global equities so far today, but the continuation of the current downtrend for GBP USD is dependent on tomorrow afternoon’s Michigan Confidence survey. Another poor showing from this closely-watched release could trigger further support for the Greenback. The Dollar is expected to trade on a NEUTRAL TO POSITIVE footing ahead of this publication.

The NEW ZEALAND DOLLAR has continued to storm ahead against Sterling today, sending the GBP NZD exchange rate down to a new multi-decade low at 1.8208. A strong showing for last night’s Business NZ Performance of Manufacturing Index helped provide positive momentum for the ‘Kiwi’ today; if tonight’s domestic Retail Sales numbers for quarter four are equally positive, then a move down to the 1.8000 level would appear likely for GBP NZD. For this reason, the near-term outlook for the ‘Kiwi’ is POSITIVE.

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