Foreign Currency Exchange Rate Predictions For GBP EUR AUD USD

Modified: Monday, 3 June 2013 12:22 BST - Written by Ben Hughes

STORY LINK Foreign Currency Exchange Rate Predictions For GBP EUR AUD USD

The latest Purchasing Managers’ Index survey of the manufacturing sector of the UK economy provided the POUND STERLING with a welcome shot in the arm at the start of the week’s session. The data showed that Britain’s manufacturing sector had returned to expansion last month, however the morning’s revelation that the UK’s retail banks continue to reduce their overall levels of lending had the opposite effect. The Pound is expected to trade on a NEUTRAL footing in the lead up to Thursday’s Bank of England policy announcement.

The EURO has put in a tame performance so far today, sending the GBP EUR exchange rate up to 1.1732 earlier on. A decent showing from the latest French and whole of eurozone PMI manufacturing surveys were not enough to divert investors’ attention away from Thursday’s European Central Bank policy announcement, with euro-holders wary of another cut in its key lending rate by the ECB. The outlook for the EURO is NEUTRAL TO NEGATIVE.

The AUSTRALIAN DOLLAR has posted respectable gains against Sterling so far today, sending the GBP AUD exchange rate down to 1.5785. The move in favour of the Aussie, which comes in spite of a generally ‘risk off’ mood in global share markets, suggests that investors believe that the Reserve Bank of Australia will avoid the temptation to cut interest rates early tomorrow. In the meantime, the Aussie is expected to trade with a NEUTRAL TO POSITIVE bias.

The US DOLLAR has leaked support so far today as market participants continue to digest recent comments from Federal Reserve policymakers. With some of last week’s US data, including the world’s largest economy’s latest GDP figure, showing at disappointingly soft levels, some investors have scaled down their bets on a near-term tapering of Quantitative Easing in the US. The US Dollar is now trading on a NEUTRAL footing and the GBP USD exchange rate currently stands at 1.5258.

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