Exchange Rate Forecasts

The Pound unexpectedly declined against the Euro yesterday, dropping 0.7% to trade well under 1.4900 by the close last night despite the Bank of England’s decision to lift interest rates by a further quarter-point to 5.0% with the aim of containing inflation and avoiding demands for higher wages. The MPC and the governor of the [...]

The Pound remained largely unchanged against the majors yesterday as we build up to the Bank of England interest rate announcement at midday today and it is widely anticipated that the monetary policy committee will raise UK interest rates to 5.0%, the highest lending rate in 5-years, as inflation still holds above the government’s 2.0% [...]

The Pound made further gains against the majors yesterday, firming 0.4% against the Dollar and a further 0.1% versus the Euro following a band of positive economic data, which only emphasised the need for a further rise in UK interest rates. Firstly, the National Institute of Social and Economic Research released a positive forecast into [...]

The Pound lost more ground against the majors yesterday, falling 0.7% against the Euro and a further 0.2% versus the Dollar following a round of disappointing UK economic data. Manufacturing output unexpectedly slowed in the month of September with factory production unchanged after expanding in each of the previous four months. The decline in production [...]

Without doubt, the focus this week will fall on the Bank of England interest rate announcement on Thursday where the monetary policy committee are widely expected to lift UK interest rates by a further quarter-point to 5.0% as inflation still remains above the government’s 2.0% target despite a sustained drop in energy prices and the [...]

The Euro advanced yesterday, firming 0.2% against both the Euro and the Dollar as the ECB kept Euro-zone interest rates on hold at 3.25% but clearly signalled a further tightening of monetary policy could be expected in December. In the accompanying press conference, the chairman of the Central Bank, Jean-Claude Trichet, used the specific language [...]

Following a sparse supply of economic data released yesterday, the focus today will fall heavily on the ECB interest rate announcement at midday and perhaps more significantly, the accompanying press conference where the chairman, Jean-Claude Trichet, may signal a further rate increase in December. In each of the prior months to a rate hike in [...]

The Pound made yet further gains against the majors yesterday, firming an additional 0.3% against the Dollar and 0.1% versus the Euro by the close last night, although Sterling did achieve a new yearly high against the single currency at 1.4980 earlier in the session. There was some positive economic data released yesterday as the [...]