UPDATE
The Pound Sterling to US Dollar (GBP/USD) exchange rate advanced by around 0.3% on Thursday morning, whilst the Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate was trending within a narrow range.
As traders await British economic data, the Pound edged higher versus most of its major peers. The slight appreciation can be linked to speculation that UK retail sales will improved thanks to accelerated wage growth and ultra-low interest rates. Flat line consumer prices may also aid retail sales growth.
The US Dollar, meanwhile, softened versus many of its currency rivals thanks to dampened demand for safe-haven assets after Greek MPs accepted a second package of reforms to unlock financial aid. US jobs data, due for publication later on Thursday afternoon, has the potential to provoke US Dollar volatility.
Despite the fact that crude oil prices remain low, the Canadian Dollar avoided a significant depreciation. This is partly due to traders having priced-in a Bank of Canada (BOC) rate cut amid bearish crude prices, but also in response to speculation that Canadian retail sales data will print positively.
The Pound Sterling to US Dollar (GBP/USD) exchange rate is currently trending in the region of 1.5658.
The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate is currently trending in the region of 2.0366.
Yesterday…
Pound Sterling to US Dollar (GBP/USD) Exchange Rate Forecast to Gain ahead of US Housing Data
The Pound Sterling to US Dollar (GBP/USD) exchange rate advanced by around 0.4% on Wednesday afternoon.
Despite the fact that all nine Bank of England (BoE) Monetary Policy Committee (MPC) members voted unanimously against a benchmark rate increase, as evidenced by minutes from the most recent interest rate decision, the Pound advanced versus most of its currency rivals. The appreciation is the result of speculation that several policymakers will dissent during Augusts’ interest rate decision meeting. This is because the minutes indicated that many MPC members refrained from voting to hike the rate as uncertainties surrounding Greece presented too big of a risk. Now that geopolitical tensions in the Hellenic nation have eased to a large extent, rate hawks are speculating proactive decisions ahead.
The Pound Sterling to US Dollar (GBP/USD) exchange rate is currently trending in the region of 1.5614.
As traders await US housing data, due for publication later on Wednesday afternoon, the ‘Greenback’ (USD) is generally holding steady versus most of its currency competitors. After having surged significantly amid speculation of a fourth-quarter Federal Reserve rate hike, the US asset weakened slightly as traders took advantage of attractive selling positions. The Pound Sterling to US Dollar (GBP/USD) exchange rate was trending within the range of 1.5549 to 1.5648 during Wednesday’s European session.
Pound Sterling to Canadian Dollar (GBP/CAD) Exchange Rate Forecast to Rally on Bearish Oil Prices
The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate surged by around 1.1% on Wednesday afternoon.
‘For a number of members, the balance of risks to medium-term inflation relative to the 2% target was becoming more skewed to the upside at the current level of Bank Rate. For these members, the uncertainty caused by recent developments in Greece was a very material factor in their decisions: absent that uncertainty, the decision between holding Bank Rate at its current level versus a small increase was becoming more finely balanced,’ stated minutes from the most recent BoE interest rate decision.
The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate is currently trending in the region of 2.0343.
The Canadian Dollar, meanwhile, dived versus most of its currency rivals on Wednesday morning. The depreciation is the result of tanking oil prices, with WTI Crude at around $50.29 per barrel. The significant depreciation can be linked to an unexpected rise in US crude stocks. This, combined with speculation that Iran will add considerable amounts to the global oil surplus, is likely to keep oil prices weak for some time to come. The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate was trending within the range of 2.0128 to 2.0314 during Wednesday’s European session.
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