FX Exchange Rate Forecasts: Pound Sterling (GBP), Euro (EUR), US Dollar (USD) & New Zealand Dollar (NZD)

Modified: Monday, 2 December 2013 23:30 BST - Written by Frank Davies

STORY LINK FX Exchange Rate Forecasts: Pound Sterling (GBP), Euro (EUR), US Dollar (USD) & New Zealand Dollar (NZD)

The POUND STERLING has generally performed strongly against all of the other sixteen most actively traded global currencies during recent months and yesterday’s session was no exception to this rule. With Thursday’s Bank of England policy announcement highly unlikely to yield any unpleasant surprises for investors holding Sterling-denominated assets, the next risk event of note for the Pound comes in the form of Friday’s Autumn budget statement from the Chancellor of the Exchequer. In the meantime the Pound is expected to trade with a NEUTRAL TO POSITIVE bias.

The Pound struck a new 10 ½ month high against the EURO during yesterday’s session, breaking the 1.2100 threshold for the first time since January during early trading. It’s bad news for the single currency that it is leaking support in the market in spite of the generally better than anticipated nature of recent data releases from the eurozone including yesterday’s healthy Factory Orders figure. ‘What should go up and doesn’t go up can only come down’, so the euro is forecast to trade on a NEUTRAL TO NEGATIVE footing in the near term.

The US DOLLAR continued to edge lower against Sterling during yesterday’s session, sending the GBP USD exchange rate all the way up into the high 1.6300s. Even a significantly stronger than anticipated showing from last month’s US ISM Manufacturing survey, published yesterday afternoon, failed to halt the Buck’s recent demise. The US tender badly needs Wednesday’s Federal Reserve Beige Book to hint at better things to come for the American economy. In the absence of such an assessment, the outlook for the Greenback is NEUTRAL TO NEGATIVE.

The NEW ZEALAND DOLLAR clawed back a decent amount of the preceding week’s losses against Sterling during yesterday’s session. The Kiwi was not unduly burdened by a bout of risk aversion emanating from China on the day which was triggered by a relaxation of the listing rules in the stock exchange of the world’s second largest economy. With no data releases of note due out of New Zealand this week, the NZD is likely to be allowed to continue the technical retracement against Sterling which it began yesterday. The Kiwi is forecast to trade with a NEUTRAL TO POSITIVE bias in the short term and the GBP NZD exchange rate currently stands at 1.9973.

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TAGS: American Dollar Forecasts Currency Predictions Dollar Poun Forecasts