Exchange Rate Predictions / Forecasts for Pound Sterling (GBP), Euro (EUR), Dollar (USD) & Canadian Dollar (CAD)

Modified: Tuesday, 10 December 2013 10:03 BST - Written by David Woodsmith

STORY LINK Exchange Rate Predictions / Forecasts for Pound Sterling (GBP), Euro (EUR), Dollar (USD) & Canadian Dollar (CAD)

The POUND STERLING put in another lacklustre performance against the majority of the other sixteen most actively traded global currencies during yesterday’s session. The UK tender suffered during the latter part of the trading day following comments from Bank of England Governor Mark Carney in New York which suggested that British monetary policy will remain loose for some years to come. The forecast for the Pound is NEUTRAL.

The EURO was trading up against the US Dollar and the Pound during yesterday’s session, sending the GBP EUR exchange rate down to as low as 1.1914 during early trading. A positive set of German current account data helped the single currency on the day as did an upward revision to France’s Q4 2013 growth forecast. This morning’s Italian Q3 GDP data could prove to be market-moving; in the meantime the single currency is expected to trade on a NEUTRAL TO POSITIVE footing.

The US DOLLAR slumped in the markets during yesterday’s session, sending the GBP USD exchange rate up to 1.6428 late on. The renewed move out of Dollar-denominated assets was driven by the ongoing lack of consensus amongst Federal Reserve policymakers regarding the timing and duration of a tapering of America’s Quantitative Easing programme. Analysts predict that the Greenback will trade on a NEUTRAL TO NEGATIVE footing moving forward.

The CANADIAN DOLLAR continued to plumb the depths against Sterling yesterday, sending the GBP CAD exchange rate all the way up to 1.7483. A 2% drop-off in the price of a barrel of Brent Crude Oil heaped further pressure on the Loonie and calls from US Federal Reserve policymaker Fisher for his Bank to begin tapering its QE programme ‘at the earlier opportunity’ added to the selling pressure on the CAD. The Canadian unit has lost a lot of ground in a short space of time, so a technical correction can not be ruled out. Until such a downside move arrives, expect the Canadian tender to trade with a NEUTRAL TO NEGATIVE bias.

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