Pound Sterling (GBP) Exchange Rate Softer after Sales Stats
On Wednesday demand for the Pound was undermined by the Bank of England’s dovish meeting minutes.
The UK currency extended its bearish run on Thursday after UK retail sales data increased concerns that Britain’s economic recovery might be struggling.
While month-on-month sales stagnation had been anticipated, the pace of sales growth was shown to have fallen by -0.3% in September due to reduced demand for clothing.
Sales including autos also dropped by -0.3% rather than shedding the -0.1% anticipated.
A separate report showed that BBA Loans for House Purchase declined considerably in September.
The data saw investors turn from the Pound, and the Pound to Euro (GBP/EUR) exchange rate accordingly shed -0.35%. The Pound to US Dollar (GBP/USD) and Pound to Australian Dollar (GBP/AUD) exchange rates were also trending in a softer position.
However, the Pound could recoup some of this week’s declines if the UK’s third quarter gross domestic product data surprises to the upside. Economists have forecast that quarter-on-quarter UK GDP slowed from 0.9% to 0.7% in the third quarter of the year.
The GBP/EUR exchange rate is currently trending in the region of 1.2636.
US Dollar (USD) Bullish before Employment/Manufacturing Figures
Although China’s better-than-forecast manufacturing PMI increased demand for higher-risk assets, the US Dollar was still enjoying a bullish relationship with several of its most traded currency peers on Thursday.
On Wednesday the ‘Greenback’ gained thanks to the pace of inflation in the US holding steady in September rather than slowing as anticipated.
The US Dollar to Euro exchange rate achieved a high of 0.7929 but later pared gains after Eurozone PMI exceeded expectations.
Today there are several high-profile US reports with the potential to spark US Dollar exchange rate movement.
The US Markit Manufacturing PMI is expected to have eased in October, moving from 57.5 to 57.
Meanwhile, the number of people filing for unemployment benefits for the first time in the week ending October 18 is believed to have increased from 264,000 to 281,000.
Any positive surprises would be US Dollar supportive.
The US Dollar to Pound Sterling (USD/GBP) exchange rate is currently trending in the region of 0.6241.
Euro (EUR) Fluctuating Amid Stimulus Speculation
The Euro gained by 0.4% against the Pound and 0.2% against the US Dollar on Thursday as investors breathed a sigh of relief over the Markit Manufacturing/Services/Composite PMI’s for the Eurozone and its largest economies.
While the French figures were worse than feared, the indexes for Germany and the Eurozone as a whole exceeded expectations.
Although the Euro was buoyed by the news, a statement published by the figures was less than enthusiastic; ‘The Eurozone PMI rose in October but anyone just watching the headline number misses the darker picture painted by the survey’s other indices, which show the region teetering on the verge of another downturn. Growth of new orders slowed closer to stagnation and backlogs of work fell at a faster rate, causing employment to be cut for the first time in nearly a year.’
The Euro could trim some of its recent gains if today’s Eurozone consumer confidence report registers a decline in sentiment.
The Euro to US Dollar (EUR/USD) exchange rate is currently trending in the region of 1.2667.
Indian Rupee (INR) Static as Markets Close
With Indian markets closed for the Diwali/Deepavali holiday, any movement in the Indian Rupee has been driven by global economic developments.
For example, the GBP/INR exchange rate edged away from a high of 98.9830 in response to the UK’s unimpressive retail sales report.
Meanwhile, the USD/INR pairing was trending higher ahead of the release of the day’s US data.
The US Dollar to Indian Rupee exchange rate was trading close to 61.1600 and could push higher if the US Markit Manufacturing PMI fails to decline as forecast.
The Pound Sterling to Indian Rupee (GBP/INR) exchange rate is currently trending in the region of 98.9010
