Pound Sterling AUD NZD CAD Forecast Hinges on Global Inflation Data

Published: Monday, 12 October 2015 07:00 BST - Written by David Woodsmith

STORY LINK Pound Sterling AUD NZD CAD Forecast Hinges on Global Inflation Data

Pound Sterling Exchange Rate News & Forex ALERT

Most analysts forecast a busy week ahead for the global FX markets, with data releases penned for publication in several of the leading economies before Friday’s weekend market close.

Central Bank Interest Rate Speculation Forecast to Impact GBP, EUR, USD Exchange Rate Trading

Speculation from investors regarding the likely future direction of central bank policy has been a key driver of price action for almost all of the sixteen most actively traded world tenders in recent months. The majority of FX insiders view the future trajectory of interest rates as one of the most significant factors in the forecast performance of the currency which they are looking at. Because of the link between the cost of credit and the pace of price rises, inflation data is therefore considered key in predicting future policy decisions from central banks.

FX Predictions: UK CPI Expected to Impact Pound Sterling Conversion Rate Trading

This week’s session brings the publication of the latest set of Consumer Price Index inflation data from three of the world’s premier economies; the UK leads the way with release of September’s price rise figures early tomorrow morning. August’s counterpart stats pointed to no overall increase in domestic prices during the twelve months which preceded. The September edition is expected to show a modest, but none the less significant, year-on-year increase of 0.2% in British prices. Such an outcome is forecast to provide sustained support for the Pound Sterling (currency : GBP) for the remainder of the weekly session.

USD, NZD, AUD Exchange Rate Outlook Today: Chinese News in Focus

The early hours of Wednesday morning brings the publication of the self-same data in the world’s second largest, (and some would say, soon to be largest), economy. August’s Chinese Consumer Price Index numbers showed at an annualised 2.0% - if the forecast drop to 1.8% for the September figure materialises, then expect major movement for the Commodity Dollars. The Australian Dollar (currency : AUD), New Zealand Dollar (currency :NZD) and Canadian Dollar (currency : CAD) remain heavily dependent on burgeoning levels of Chinese demand. Lower levels of inflation in China would give the People’s Bank of China scope to further loosen its monetary policy, stoking domestic levels of aggregate demand. The Commodity Dollars would similarly benefit from a relatively low reading from Thursday afternoon’s US inflation numbers.

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