The Pound was able to make gains against the Danish Krone on Monday as the UK currency found support ahead of the week’s major data releases and the reduction in safe haven demand. The Krone meanwhile eased because of mixed domestic data.
Sterling was finding support as investors turned their attention to Wednesday’s Bank of England economic projections.
The inflation, unemployment and wage growth data will offer the markets insight as to whether an interest rate hike is likely to occur before the end of the year.
Some economists are saying that the session will prove to be a make or break day for bullish bets for the Pound.
If the data comes in positively then the Pound could see resurgence, especially if Bank of England governor Mark Carney says that rate hikes are on course.
The key factor midweek will be the latest UK wage growth data as policy makers recently stated that low wages are holding back any decision on rate rises.
‘The degree of labour-market slack evident from wage data suggests that there is no immediate rush to move rates higher. Given the uncertainties surrounding estimates of potential GDP growth, there are very wide confidence intervals around,’ said an economist from Commerzbank AG.
The Danish Krone meanwhile came under pressure after a better-than-forecast inflation rate figure was countered by weakening balance of trade and current account data.
According to Statistics Denmark, Danish Consumer Price Inflation increased from 0.5% to 0.8% in July a figure, which was better than the forecasted number of 0.6%.
Offsetting that was current account data, which showed that the country’s balance narrowed from May’s figure of 13.3 billion DKK to 10.5 billion DKK. Denmarks balance of trade also slipped from 7.1 billion DKK to 4.6 billion DKK.
UPDATED 09:50 GMT 12 August, 2014
GBP/DKK Higher before Jobs Data
After advancing on the Danish Krone yesterday the Pound managed to retain its stronger position ahead of tomorrow’s UK employment figures and the Bank of England’s inflation report.
The GBP/DKK pairing was little affected by the UK’s unimpressive British Retail Consortium’s Like-for-Like Sales report, but tomorrow’s UK data could spark some notable currency market volatility.
If the UK’s average wage growth figure surprises to the upside the Pound could enjoy widespread gains. Conversely, a disappointing result could drag Sterling lower against its major currency counterparts.
The rest of this week is fairly sparse in terms of economic news for Denmark but investors will be looking ahead to next week’s Consumer Confidence Measure and Retail Sales figures.
The Pound Sterling to Danish Krone exchange rate is currently trending in the region of 9.3580.
Danish Krone (DKK) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
Pound Sterling,
,Danish Krone,9.3427 ,
Euro,, Danish Krone,7.4555 ,
US Dollar,, Danish Krone,5.5669 ,
[/table]
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