Exchange Rate Forecasts - Australian Dollar, Cdn Dollar & NZ Dollar Exchange Rates To Gain On Low Volatility Levels

June 20, 2014 - Written by John Cameron

STORY LINK Exchange Rate Forecasts - Australian Dollar, Cdn Dollar & NZ Dollar Exchange Rates To Gain On Low Volatility Levels

Foreign Exchange Rate Forecasts - Low volatility levels in the global currency markets have favoured the high-yielding currencies during Thursday's session.

Leading financial institution Deutsche Bank operates a daily gauge of volatility levels in the global currency markets and yesterday’s session saw the reading drop to 5.28% - its lowest level for some 13 years.

Yesterday's exchange rates saw the Pound to Australian Dollar exchange rate close at 1.81199, Pound to Canadian Dollar exchange rate close at 1.83072, Pound to Euro exchange rate close at 1.25111, Pound to New Zealand Dollar exchange rate close at 1.95698, and the Pound to Dollar exchange rate close at 1.70151.

Greg Moore of Royal Bank of Canada backed this up, stating earlier that, ‘volatility across asset classes has continued to plummet.’

Pound Sterling (GBP) fails to see gains against Australian and New Zealand Dollars

A slight uptick today hasn’t been enough to see the Pound Sterling record any meaningful gains against the risk-driven Australian and New Zealand Dollars (currency:AUD) and (currency:NZD).

The Sterling New Zealand Dollar exchange rate (GBP/NZD) tested lower during the early part of the European equities session, touching 1.9539 earlier following an encouraging reading from the latest edition of the closely-monitored ANZ Consumer Confidence survey.

The sentiment guage showed a month-on-month increase of 3.4%, which represented a marked improvement on May’s print of -4.4%. Analysts forecast that there could be further gains to come for the New Zealand unit as investors price-in further interest rate increases to come this side of Christmas from the Reserve Bank of New Zealand.

Meanwhile, the main event for this afternoon comes in the shape of Canadian Consumer Price Index data for last month.

The Canadian Dollar (currency:CAD) has firmed a little ahead of the key release; anything above the anticipated year-on-year print of 2.1% is likely to stoke economists’ predictions regarding a near-term interest rate increase from the Bank of Canada.

Pound to CAD Dollar exchange rate forecast - decline

Look for the GBP CAD exchange rate to dip down towards the 1.8000 threshold once again in such a circumstance.

Elsewhere, there was some room for optimism from investors holding Sterling-denominated assets this morning when May’s UK Public Borrowing figures showed at £11.48bn versus the consensus expectation amongst analysts of a £12.00bn result.

Market participants are predicting that the British government will begin to pay down its £1tn + national debt in earnest over the next three years – such an outcome could see the Pound enjoy increased support in the global currency market.

Latest Australian Dollar, NZ Dollar & Pound Sterling exchange rates - revised 22/06/2014

The Pound Sterling to Australian Dollar exchange rate is trading up +0.19% at 1.81546 GBP/AUD.
The Pound Sterling to Canadian Dollar exchange rate is trading up +0.02% at 1.83103 GBP/CAD.
The Pound Sterling to New Zealand Dollar exchange rate is trading down -0.08% at 1.95534 GBP/NZD.
The Australian Dollar to Euro exchange rate is trading down -0.16% at 0.68937 AUD/EUR.
The Australian Dollar to Pound Sterling exchange rate is trading down -0.19% at 0.55082 AUD/GBP.
The Australian Dollar to New Zealand Dollar exchange rate is trading down -0.27% at 1.07705 AUD/NZD.

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