The pound saw a late pick up last week, ending the session slightly up from the multi-month lows struck earlier in the week as it was supported by some revised GDP figures.
Sterling appears to be trending narrowly this morning, with GBP/EUR muted at €1.1317, GBP/CAD flat at C$1.7346, while both GBP/AUD and GBP/NZD hold steady at AU$1.7865 and NZ$1.9490 respectively. Only GBP/USD has seen any notable movement so far, as it slides 0.3% to $1.3167.
Looking ahead, the pound may trend lower at the start of this week if the UK’s latest manufacturing PMI prints lower, as expected.
What’s been happening?
The pound went higher on currency markets on Friday, advancing against many of its peers as it was lifted by the UK’s final GDP reading for the first quarter.
GBP investors welcomed the data which saw UK growth revised up from 0.1% to 0.2% at the start of 2018, with analysts speculating this would help tip the odds in favour of the Bank of England (BoE) raising interest rates in August.
Further supporting the upswing in Sterling were comments from the European Union’s chief negotiator, Michel Barnier suggesting progress was being made in Brexit negotiations, although divisions remained.
The GBP/EUR exchange rate struggled to make any headway however, with the pound having to settle for closing Friday’s session where it began after suffering heavy losses against the euro at the start of the day.
The euro’s strength came in the wake of EU leaders reaching an agreement on migration following marathon discussions, with EUR investors optimistic that the deal will help to smooth over tensions in the EU and ease pressure on German Chancellor Angela Merkel.
Meanwhile the GBP/USD exchange rate climbed around a cent at the end of last week as the pairing rallied from an eight-month low struck on Thursday when the US dollar was hurt by a bout of profit taking.
What's coming up?
The pound may begin this week’s session on a slightly sourer note, following the release of the UK’s latest manufacturing PMI.
Economists forecast that today’s PMI reading will report that UK factory activity slowed slightly in June, with the index expected to slide from 54.4 to 54, its second-lowest reading in a year.
Meanwhile the Eurozone will publish its latest unemployment figures later this morning, with the euro potentially strengthening if the jobless rate holds at a near 10-year low.
Finally the US will publish its own manufacturing PMI this afternoon, with a suspected slowdown in activity potentially weakening the US dollar.
We’re here to talk currency whenever you need us, so get in touch if you want to know more about the latest news or how it could impact your currency transfers.
Currencies Direct
One Canada Square
Canary Wharf
London
E14 5AA
T: +44 (0) 20 7847 9400
W: currenciesdirect.com
E: customer.s@currenciesdirect.com
