British Pound Live On Thursday 27th June: The GBP Remains Weaker In Major Pairs On Disappointing GDP
German unemployment data set to be released early today and is expected to remain flat, movements either way could reflect a stronger or weaker economy. As the leading Euro nation, how will this effect the EURGBP?
18.28: FOMC Meeting Was Not Major Shift In Direction Says Fed Member Dennis Lockhart
The president of the Federal Reserve Bank of Atlanta Dennis Lockhart said today that despite recent comments from Bernanke and subsequent market movements, "Nothing has changed" in the Fed's outlook toward tightening interest rates.
"The timing of the first move to raise the policy rate will depend on overall economic conditions, but I would estimate 'liftoff,' as it is called, to come sometime in 2015," Lockhart said.
This follows the president of the Federal Reserve Bank of New York William Dudley who said earlier today that "a rise in short-term rates is very likely to be a long way off." He went on to say that the market reactions to the FOMC meeting "would be quite out of sync with both FOMC statements and the expectations of most FOMC participants."
16.29: Pound Sterling Looking Friendless Against The US Dollar As It Nears The 1.5200 Mark
The GBPUSD has continued to make downward movements against the US dollar following a string of economic data released by the US which looked positive. This included the month on month Personal Income at 0.5%, significantly better than the 0.2% which was expected. Similarly the pending home sales grew 12.1% year on year and 6.7% month on month which was again very impressive compared to the previous months number, -0.5%.
This has all contributed to a stronger dollar and the GBP has found little support from recent UK data releases. In fact the recent spate of data and speeches coming from within the UK has done little to effect the pound against any major currencies, with most recent price action coming from external developments – notably the US. As it stands the GBPUSD is down 0.57% to 1.5227 and looks like it could well drop through the 1.5200 line in the immediate future.
The FOMC’s Jerome Powell is still to speak this afternoon which could have the potential to push the pound through 1.5200.
14.21: Afternoon Spot Rates - Much Unchanged As GBP Continues to Struggle
Similar to this morning the GBP remains weaker against most major currencies, with the GBPJPY still the only notable exception.
GBPUSD is down 0.42 pct at 1.5429
GBPAUD is down 0.78 pct at 1.6378
GBPJPY is up 0.15 pct at 149.8780
EURGBP is up 0.61 pct at 0.8546
NB: The above are wholesale market quotes; your bank will affix its own discretionary spread when passing on your retail rate. However, an independent FX provider will guarantee to undercut your bank's offer, thus delivering more currency. Please find out more here.
12.30 GBP Continues To Fall Against AUD and NZD, But Could That Be About to Change?
In a surprise move the Australian Prime Minister Jillian Gillard resigned her position yesterday following pressure from her party. The move had a negative impact on the AUD in the immediate aftermath before it returned to its bullish start to the week as the Federal reserve members indicated that the markets response to Ben Bernankes comments last week was an overreaction and that it was far from certain that asset purchases would be halted by this time next year.
The NZD, often closely aligned with the AUD, reacted similarly to the Feds latest comments and showed strength in this weeks trading on the back of some significant losses over the last fortnight.
The pound sterling fell 3.5cents against the Aussie dollar and almost 5cents against the New Zealand dollar over the course of the last 10 days. The pound has continued to move lower on disappointing GDP figures.
This could offer a great BUY opportunity for traders, particularly if the numbers due from the US later suggest that the economy is continuing to strengthen – a key factor in whether or not Bernankes predictions are realised. Any strong numbers will likely weaken the AUD and NZD as commodity currencies and will support the GBP.
A range of 1.6369 to 1.6549 is expected from GBPAUD today whilst the GBPNZD is expected to stay in a range of 1.9423 to 1.9693.
11.40 Analysis of GBPUSD as it moves lower on GDP figures
The pound sterling moved lower today as the National Office of Statistics released information on the Gross Domestic Product that reported growth of just 0.3% in the first quarter of 2013. Having struggled yesterday the GBP looks set for a continued period of weakness, with the current level against the dollar of 1.5282 down significantly on yesterdays high of 1.5422.
This is despite the fact that the US Dollar is actually weaker in most major pairs as members of the Federal Reserve attempt to even out the effect of chairman Ben Bernankes comments which shook the markets last week by declaring that any measures taken to reduce or end the asset purchases will be dependent on economic figures.
If the unemployment claim data shows a positive improvement this afternoon then the USD will likely be supported and will push the GBP down in the pair.
Dependent on the impact of the news releases later today, a range of 1.5290 to 1.5402 is anticipates for GBPUSD today.
10.56: UK GDP Data Revisions - Highlights
UK gross domestic product (GDP) in volume terms was estimated to have increased by 0.3% between Q4 2012 and Q1 2013, unrevised from the previous publication. In current prices GDP was estimated to have increased by 0.9% for the same period.
GDP growth between Q4 2011 and Q1 2012 has been revised from a fall of 0.1% to flat, thereby removing the theory of two consecutive quarters of negative growth.
Real household disposable income increased by 1.4% between 2011 and 2012. This is the highest growth since 2009 when it rose by 1.6%.
The households’ saving ratio was estimated to be 4.2% in Q1 2013, the weakest since Q1 2009 when it was 3.4%.
You can download the full report here.
10.11: Morning Spot Rates, The Pound Looks Weaker Again - Except Against JPY
The GBP is generally looking weaker this morning with the US dollar, Euro and the Australian Dollar all show gains on yesterdays close against the pound sterling. The JPY is the only one that has bucked this trend having broken the 150.00 barrier overnight, despite falling back from this level the pound remains higher than yesterdays close.
GBPUSD is down 0.29 pct to 1.5270.
EURGBP is up 0.43 pct to 0.8533.
GBPJPY is up 0.14 pct to 149.8610.
GBPAUD is up 0.49 pct to 1.6426.
NB: The above are wholesale market quotes; your bank will affix its own discretionary spread when passing on your retail rate. However, an independent FX provider will guarantee to undercut your bank's offer, thus delivering more currency. Please find out more here.
09.00: German Unemployment Figures Stay Constant
German unemployment stayed at 6.8% as predicted by most analysts and in line with the previous months.
08.00: What to Expect From the German Unemployment Figures?
The morning kicks off with the unemployment change figures for June from everyones favourite Euro nation, Germany. With the consensus for June at 8k compared to 21k last month, high numbers could well result in a negative impact on the Euro whilst lower numbers will please those taking bullish positions on the currency.
The German Statistics Office will also release data on the percentage of the German population that are unemployed. The data is expected to show no movement on the previous months percentage at 6.9%. As above, a decrease in the percentage of the population that is unemployed will be understandably positive for the nation. In turn it will be positive Eurozone as a whole as Germany is the leading economy in the region and the unemployment data will be a good indication of the strength and growth of the German economy.
07.35: European News Releases Set To Dominate Todays Events, What Can We Expect?
The majority of the action appears to be in the morning European session as Germany releases its Unemployment data and the UK releases its GDP figures.
08.55 – (Germany) The German Statistics Office release key data on the level of unemployment within the country, an important indicator of economic growth.
09.30 – (UK) The Office of National Statistics release the Current Account data from the first quarter of 2013, which is a net flow of current transactions incorporating goods, services and interest payments in and out of the country.
09.30 – (UK) The Gross Domestic Product data is also published by the Office of National Statistics and could have significant impact on the strength of the pound. Generally seen as a significant indicator of the strength of the economy, it is expected to grow by 0.3% (the same as the previous month).
09.30 – (UK) The Total Business Investment report is an indication of growth and details the amount of capital expenditures made by private firms.
10.00 – (Euro) Economic Sentiment Indicator for June is a report released by the European Commission and surveys consumer confidence in the economic activity of the region.
13.30 – (US) A string of data is released in the US including Personal Spending data for the month of May, Core Personal Consumption Expenditure details Year on Year and Personal Income for May.
15.00 – (US) Pending Home Sales figures released by the US National Association of Realtors, a leading indicator of the US housing market.
15.30 – (US) FOMC member Jerome Powell is to give a speech which may have an impact on the short term actions of the dollar.