Forex Predictions Today: Has Pound Sterling (currency: GBP) Peaked in the Global Currency Markets?

Published: Thursday, 10 September 2015 09:30 BST - Written by John Cameron

STORY LINK Forex Predictions Today: Has Pound Sterling (currency: GBP) Peaked in the Global Currency Markets?

UK Production Data Sends Pound Sterling (GBP) Conversion Rate Lower before BoE Rate Decision

All in all, the fundamental data emanating from the UK during yesterday’s session was of a distinctly negative tone. The morning session saw the publication of July’s British Industrial Production numbers. Hopes had been relatively high for this keynote release, with analysts expecting a slight monthly increase of 0.1%; the result of -0.4% therefore hit the Pound Sterling (currency : GBP) hard during morning trading.

GBP to EUR, USD, AUD Exchange Rates Fluctuate as Production Slows & UK Deficit Swells

The negative effect of the Industrial Production numbers was compounded by the publication of what was, in relative terms at least, an even weaker set of July UK Manufacturing Production figures. Market insiders had been anticipating a month-on-month increase in activity levels of 0.2%, so the contraction of 0.8% represented further bad news for Sterling. The disappointing result was blamed on a poor showing from the basic metals and metal products alongside the transport equipment sectors of the economy, suggesting that British transportation companies were scaling back their levels of investment into capital-intensive projects.

The latest UK Trade Balance numbers, published at the same time, also disappointed, revealing that Britain’s trade gap had widened significantly during the month of July.

The Office of National Statistics, which publishes the official data, commented that, ‘exports of goods decreased by £2.3 billion to £22.8 billion in July 2015, the lowest export figure since September 2010. This is attributed to decreases in semi-manufactures (specifically chemicals) of £1.0 billion and finished manufactures of £0.8 billion. Imports of goods increased by £0.3 billion to £33.9 billion over the same period.’

Recent figures suggest that the domestic economy continues to recover, but these import / export numbers provide evidence that this recovery is far from a balanced one.

British Pound (GBP) Forecast to Decline against 16 Most Traded Global Currencies

The final nail in the Pound Sterling’s coffin yesterday came towards the end of the trading day when the widely-respected National Institute of Economic and Social Research published its latest UK Gross Domestic Product Estimate. The forecast showed that the increase in levels of economic activity in the domestic economy slowed to 0.5% during the three months to the end of August – down from July’s counterpart print of 0.7%. The future looks far from bright for the Pound Sterling against the sixteen most actively traded global currencies.

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