GBP USD Exchange Rate Forecast To Drop, GBP NZD & GBP EUR Improve

Published: Thursday, 30 January 2014 16:00 BST - Written by Minesh Chaudhari

STORY LINK GBP USD Exchange Rate Forecast To Drop, GBP NZD & GBP EUR Improve

The past 24hrs have brought significant movement in the global foreign currency markets following last night’s confirmation from the US Federal Reserve that it is trimming its Quantitative Easing programme by $10bn per month. The main beneficiary of the Fed’s action has been the US Dollar as investors priced-in a high likelihood that the US central bank’s bond buying scheme will be assigned to the annals of history by the start of Summer. The news sent the Pound Dollar exchange rate (GBP/USD) tumbling to as low as 1.6440 during this morning’s European session.

The New Zealand Dollar has lost ground in the wake of the Fed announcement, partly because of the dip in global appetite for risk which it triggered and partly because of last night’s comments from Reserve Bank of New Zealand Governor Graeme Wheeler last night confirming that he still considers the Kiwi Dollar to be overvalued. Wheeler’s words sent the GBP NZD exchange rate up to a range-topping 2.0285 earlier, however these gains are likely to prove short-lived given that Wheeler also confirmed that it is likely that his bank will be hiking its key interest rate in the very near future.

Elsewhere, the Pound euro exchange rate (GBP/EUR) has experienced considerable volatility so far today following the publication of a slew of data sets in the eurozone. Better than anticipated German jobs numbers, which revealed that the overall level of unemployment in the giant Teutonic economy unexpectedly fell to 6.8% last month. GBP EUR dropped into the lower part of the 1.2000 – 1.2100 range as a consequence, but it picked up later in the day when lower than expected German inflation figures and a whole of eurozone Consumer Confidence survey were released. The fall-out has seen the GBP EUR exchange rate head northwards towards the 1.2200 level once more.

International Money Transfer? Ask our resident FX expert a money transfer question or try John's new, free, no-obligation personal service! ,where he helps every step of the way, ensuring you get the best exchange rates on your currency requirements.

TAGS: American Dollar Forecasts Currency Predictions Dollar Poun Forecasts