The Pound Sterling to South African Rand exchange rate has softened on Thursday after South African Producer Prices Index exceeded expectations.
The Pound Sterling to South African Rand exchange rate is currently trending in the region of 17.6340.
This week has had very few influential economic data publications, pertaining to the UK, to reverse the Pound’s downward trend which began at the end of last week following inadequate retail sales growth. Sterling has had to rely, therefore, on foreign currency changes to affect movement. However, the general bullishness of the US Dollar and the weakness of the Euro had not helped the Pound claw back the losses.
A succession of increasingly disappointing Eurozone data has had a detrimental effect on the Pound given the close trading relationship between the UK and the Eurozone. In particular, last Thursday’s Manufacturing PMI failed to meet with expectations and Sterling has struggled to recover.
Sentiment towards the Pound has diminished in light of the ongoing Scottish bid for independence. With the Scottish citizens undecided and with the debate in full swing; demand for the Pound has waned considerably in favour of less risky currencies.
The South African Rand experienced a healthy boost after the publication of their Gross Domestic Product data. Despite the fact that year-on-year Gross Domestic Product was forecast to grow by 1.47%, but only printed growth of 1.0%, the data showed that South Africa had avoided sliding into recession. The slight lack of growth is likely to be connected to the mining strike which lasted around 5 months and had a significant impact on output and overall growth.
The Pound Sterling to South African Rand has hit a low today of 17.5500.
Thursday’s British economic data is scarce and of little consequence to wider market movement or the Strength of the Pound. However, it may be of interest to those who want to gauge the current economic standing of the UK. The Lloyds Business Barometer printed at 47 having fallen from the previous figure of 52. The CBI Reported Sales data exceeded the forecast figure of 27, printing at 37 compared with the previous figure of 21.
South African domestic data on Thursday has a little more weighting in terms of market movement and the strength of the Rand. The year-on-year Producer Prices Index was forecast to grow by 7.5% having grown by 8.1% previously. The actual result exceeded expectations printing at 8.0% growth. The monthly Producer Prices Index showed growth in July of 0.5%, having only grown by 0.3% previously.
UPDATE
The Pound Sterling to South African Rand exchange rate has strengthened on Friday after a positive set of British domestic data publications reverses the downward trend.
The Nationwide House Px showed a 0.8% growth in August having only been forecast to increase by 0.1%. The year-on-year figure printed at 11.0% despite only having been forecast for a growth of 10.2%.
The Consumer Confidence Survey was expected to retract by -1 having shown a declination of -2 previously. However, the actual result showed an increase to 1 which has helped bolster the Pound and reverse its bearish behaviour.
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