Exchange Rate Forecasts / Predictions For Euro, Pound Sterling, Dollar & Yen (EUR GBP USD JPY)

March 31, 2014 - Written by Ben Hughes

STORY LINK Exchange Rate Forecasts / Predictions For Euro, Pound Sterling, Dollar & Yen (EUR GBP USD JPY)

The EURO (currency:EUR) suffered a blow earlier today when official figures revealed that the level of inflation in the eurozone tumbled to 0.5% this month – down from February’s 0.7% reading. The news increases the chances that the European Central Bank will announce a further easing of its monetary policy on Thursday – a move which would hit the single currency hard. In the meantime, tomorrow morning’s German unemployment figures have the potential to bolster the euro, which is now expected to trade on a NEUTRAL TO NEGATIVE footing moving forward. The current Pound Euro exchange rate stands at 1.2067 GBP/EUR.

For some time now, the POUND STERLING (currency:GBP) has been propped up by a resurgence in the UK property market. However, the increase in British house prices was placed in peril by figures published by the Bank of England earlier today which revealed that the number of UK citizens taking out mortgages had dropped for the first time for over a year last month. Tomorrow morning’s PMI survey of the manufacturing sector of the UK economy is the next risk event of note for the Pound, which is expected to trade on a NEUTRAL TO NEGATIVE footing in the near-term Pound Sterling forecast.

The US DOLLAR (currency:USD) has once again struggled against Sterling during today’s session, sending the Pound Dollar exchange rate up to as high as 1.6656 GBP/USD. The Buck has leaked support thanks to a continued positive performance from global stock markets, however with the US Federal Reserve hinting that an interest rate hike is not far off in the States, it would appear highly possible that the Greenback may have weakened by as much as it is going to against the Pound. Look out for comments from Fed Chairwoman Janet Yellen later this afternoon as the next risk event of note for the Buck which, for now, is expected to trade with a NEUTRAL TO POSITIVE bias.

The JAPANESE YEN (currency:JPY) has leaked support against the Pound today. At one stage earlier, the Pound Yen exchange rate was trading up by over half a percentage point at 171.94 GBP/JPY – a significant move given that Sterling has struggled on the day. Overnight figures which showed that Japanese factory output declined by 2.3% last month hurt the Yen and with Japan’s policymakers still appearing keen on further weakening their local currency in an effort to boost domestic industry, the future looks relatively bleak for the JPY. The Japanese unit is forecast to trade on a NEGATIVE footing in the short term.

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