Election Exchange Rate Forecasts for the British Pound, Euro, US Dollar and NZ Dollar

Modified: Thursday, 7 May 2015 10:08 BST - Written by John Cameron

STORY LINK Election Exchange Rate Forecasts for the British Pound, Euro, US Dollar and NZ Dollar

If the latest polls are to be believed, today’s UK General Election will yield no overall majority and no hope of a straightforward coalition. Such a prospect has held back the POUND STERLING (currency:GBP) during recent sessions and if the result matches the forecasts, then Sterling will ship further support. Yesterday’s strong UK PMI Services data will not be enough to save the Pound, making the outlook for the UK unit NEUTRAL TO NEGATIVE.

The EURO (currency:EUR) powered ahead against both the Pound and the US Dollar during yesterday’s session in the global currency markets. The news that Greece had made its latest interest payment to the International Monetary Fund helped the single currency, but the near-term support for the euro may prove short-lived. Analysts forecast that there remains a high likelihood that Greece will miss debt repayments to her creditors later this month, meaning that the outlook for the euro remains NEGATIVE. The GBP EUR exchange rate stands at 1.3440.

The US DOLLAR (currency:USD) suffered renewed downside during yesterday’s session thanks to a poor showing from the latest set of domestic private sector jobs numbers. The Buck sorely needs this afternoon’s weekly employment numbers to paint a rosier picture otherwise it risks losing further ground against its peers. Friday’s US Non-Farm Payrolls data will be defining for the US tender into the medium term – another poor showing will lead analysts to forecast no American interest rate hike until 2016. The outlook for the Greenback is NEUTRAL TO NEGATIVE and GBP USD stands at 1.5220.

The NEW ZEALAND DOLLAR (currency:NZD) took a hammering in the markets yesterday following the publication of a tame set of domestic jobs numbers late on Tuesday night. Analysts had been anticipating a drop in the overall rate of Kiwi unemployment to 5.5% so they were disappointed when the official data showed that joblessness in the Land of the Long White Cloud remained stable at 5.8%. With Greece’s debt issues continuing to threaten global appetite for risk, the export-driven Kiwi Dollar could suffer a bout of heavy selling pressure at a moment’s notice. Analysts predict that the Kiwi will trade on a NEUTRAL TO NEGATIVE footing moving forward. GBP NZD sits at 2.0324.

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