Exchange Rate Forecast: Pound (GBP), Dollar (USD), Euro (EUR), Australian Dollar (AUD), New Zealand & Canadian Dollars (NZD CAD)

Modified: Friday, 21 February 2014 16:38 BST - Written by John Cameron

STORY LINK Exchange Rate Forecast: Pound (GBP), Dollar (USD), Euro (EUR), Australian Dollar (AUD), New Zealand & Canadian Dollars (NZD CAD)

Pound Sterling exchange rate (currency:GBP)

The Pound firmed against most of its major peers on Friday after data showed that the UK had a budget surplus in January. A separate report showed that retails sales fell last month but that was widely ignored as economists said that the decline was most likely the result of the bad weather.

According to the data the UK had a budget surplus of £4.7 billion in the first month of 2014.

The figure was below economist expectations for a surplus of £8 billion and was below the previous year’s amount of £6 billion. Retail sales fell by 1.5% last month, a bigger decline than the 1% fall expected. Retail sales for December were also revised downward to 2.5% from 2.6%. Yearly sales also came in below forecasts with sales rising by 4.3% last month compared to expectations for a figure of 5%.

US Dollar exchange rate (currency:USD)

The ‘Greenback’ was steady against its peers as investors awaited the release of home sales data which was expected to show an improvement on the previous months figure. The Dollar also remained supported by Thursday’s upbeat economic reports which showed that a manufacturing PMI improved more than expected and the number of people claiming jobless benefit fell.

The Euro exchange rate (currency:EUR)

The Euro was having a quiet session due to the lack of key data out of the Eurozone. What data there was released matched economist forecasts. Italy posted its latest inflation rate data. Year-on-year inflation was at 0.7%, unchanged from the previous months figure and matched expectations. On a monthly basis it stood at 0.2%, again meeting forecasts. Sentiment for the Euro remains fragile after the Markit euro zone composite output purchasing managers’ index on Thursday ticked down to a two-month low of 52.7 this month, but remained close to January’s 31-month high of 52.9.

Australian Dollar exchange rate (currency:AUD)

The ‘Aussie’ is set to make its first weekly decline in a month today after Deutsche Bank forecasted that the currency may tumble by as much as 20% in two years. The ‘Aussie’ fell to a one-week low yesterday after manufacturing data out of China disappointed. Also weighing on the currency was the fall in the value of iron ore, Australia’s biggest commodity export.

New Zealand Dollar exchange rate (currency:GBP)

The New Zealand Dollar recovered some ground after risk appetite improved following the announcement of a peace deal in Ukraine and improved expectations for global growth.

Canadian Dollar exchange rate (currency:CAD)

The Canadian Dollar tumbled against the majority of its most traded peers on Friday following the publication of worse than expected retail sales data. Sales fell by -1.8% in December, the biggest fall recorded in a year and was far worse than the -0.4% fall predicted by economists. The disappointing data added to Thursdays weaker than forecast wholesale sales data.

Important Pound Sterling Exchange Rates (Updated: 16:30 GMT 21/02/2014)

The Pound Sterling to Australian Dollar exchange rate is trading up +0.42% at 1.85707 GBP/AUD.
The Pound Sterling to Canadian Dollar exchange rate is trading up +0.16% at 1.85298 GBP/CAD.
The Pound Sterling to Euro exchange rate is trading down -0.14% at 1.21263 GBP/EUR.
The Pound Sterling to New Zealand Dollar exchange rate is trading up +0.2% at 2.01046 GBP/NZD.
The Pound Sterling to US Dollar exchange rate is trading down -0.09% at 1.66470 GBP/USD.

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