Currency Exchange Rate Forecasts: Pound, Euro, Australian Dollar & US Dollar

Modified: Friday, 4 October 2013 19:28 BST - Written by John Cameron

STORY LINK Currency Exchange Rate Forecasts: Pound, Euro, Australian Dollar & US Dollar

The POUND STERLING has endured a disappointing day on the markets. The move against the UK tender appears to be technical rather than fundamental in nature, with no tier one British data releases taking place today. Next Wednesday’s UK NIESR growth estimate and British industrial and manufacturing production figures will be market moving. In the meantime, analysts anticipate that the Pound will trade on a NEUTRAL footing.

The EURO has persisted in bully the Pound during today’s session, sending the GBP EUR exchange rate down to 1.1793. The single currency continues to benefit from a calming of the political situation in Italy following a vote of confidence in the nation’s Prime Minister. Monday morning’s whole of eurozone Sentix Confidence Index will set the direction of movement for the euro in the near-term, but for now the single currency is expected to trade with a NEUTRAL TO POSTIVE bias.

The AUSTRALIAN DOLLAR enjoyed strong support in the markets overnight, sending the GBP AUD exchange rate down to as low as 1.6991 earlier. The driver behind this forward move for the Aussie was an increase in the price of benchmark 10 year Australian government bond – a development which hints that investors feel that Australian interest rates have bottomed out. However, the continued US debt standoff threatens to sap global appetite for risk meaning that the outlook for the Australian unit is NEUTRAL TO NEGATIVE.

The US DOLLAR has enjoyed some limited support so far today, suggesting that investors feel that lawmakers in the US will reach a debt deal sooner rather than later. However, the far-reaching effects of the current partial government shutdown in the States were shown earlier today when this afternoon’s monthly Non-Farm Payrolls data was not published because government statisticians were not at work. The Greenback is expected to perform in a NEUTRAL TO NEGATIVE fashion until a US debt deal is reached.

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