Exchange Rate Forecasts

The Pound-to-Dollar exchange rate was rattled last week and now risks becoming confined to a much reduced trading range over the coming days, with the outcome hinged on the market’s reading of Wednesday’s Federal Reserve  decision and a pending flurry of U.S. economic data.

The Pound-to-Euro exchange rate suffered a setback last week and now risks finding itself sidelined into a consolidation range spanning the gap between 1.1750 and levels as low as 1.1550, pending clarity on the domestic coronavirus situation and progress of UK’s economic recovery.

Forecasts for the British Pound at a leading independent economics research house and consultancy have been downgraded, in part due to a giant disconnect between when when the market thinks the Bank of England will raise interest rates and when it will actually do so.

The Pound-to-Australian Dollar rate was edging higher at the mid-week milestone, aided by an ongoing antipodean underperformance that has got the Aussie closing in on the bottom spot among major currencies for 2021 and which could see GBP/AUD rising to 1.94 in the coming months, according to Commonwealth Bank of Australia.

The Reserve Bank of New Zealand is unlikely to raise interest rates in 2021 according to a major investment bank, creating the potential for a readjustment lower in the New Zealand Dollar.

The direction of travel for the Australian Dollar remains negative for now say analysts at Morgan Stanley who are concerned with the "asymmetric" risks posed to the economy posed by the Covid-19 Delta variant.

The Euro-to-Dollar exchange rate outlook hangs in the balance ahead of Thursday’s all-important policy update from the European Central Bank, which is pivotal to whether the single currency can sustain itself above nearby support at 1.1777, or if it succumbs to a steadily advancing greenback.

The Pound-to-Dollar exchange rate enters the new week risking a steady slide toward April lows around 1.37, which could condemn Sterling to a range-trade between there and a burgeoning resistance at 1.39 if expectations of Federal Reserve policy continue to offset for GBP/USD the signs of a shift at the Bank of England.

The Pound-to-Euro exchange rate enters the new week near significant support levels on the charts and with scope to recover the 1.17 handle in an ongoing effort to erode resistance just to the north of it, although subject to pending developments in Bank of England and European Central Bank policy guidance.

Strategists at CIBC Capital Markets are targeting a continuation in the decline of the Euro-to-Dollar exchange rate (EUR/USD), saying fundamentals continue to favour the Greenback.

The Euro-to-Dollar exchange rate was ebbing from levels above 1.18 in the penultimate session of the week but is likely to probe below there over the coming days, and could see levels as low as 1.1705, according to new targets from Credit Suisse.

The Australian Dollar has taken a cold shower in recent months, one made longer by the Federal Reserve’s (Fed) shake up of the market in June, but newly downgraded Westpac forecasts are holding out for an antipodean comeback that is expected to push GBP/AUD lower before year-end.

The British Pound looks set to retest three-month lows against the U.S. Dollar but looks better supported against the Euro, although two major investment banks we follow are expecting a more decisive decline in the Pound over coming weeks.

Foreign exchange analysts at ING Bank N.V. have announced a review of their U.S. Dollar forecasts and told clients they have turned more constructive on the currency.

UK high-street lender and international financial services giant HSBC say they expect the British Pound will fail to replicate the gains seen in the first quarter of 2021.

The Pound-to-Dollar exchange rate enters the new week in the higher end of its likely range and could be volatile over the coming days as the market digests commentary from the Federal Reserve (Fed) while processing economic data from the UK, U.S. and other major economies.

The Pound-to-Euro exchange rate enters the new week underpinned by support at 1.16 while eating away at resistance at 1.17, near to three-month highs, although international factors are clearly in Sterling’s driving seat at present and these could be a trigger for volatility in the week ahead.

The Australian Dollar could remain a laggard among major currencies in the coming months, according to newly downgraded forecasts from Commonwealth Bank of Australia, in a performance that is seen helping GBP/AUD to eventually sustain its recent move above 1.85.

Swiss private bank J. Safra Sarasin has slashed its forecasts for the Euro-to-Dollar exchange rate from 1.28.

The British Pound could be on course to test its highest levels against the Euro since the referendum, according to new research.