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Currency markets rocked by central bank rate decisions

POUND PLUNGES ON WORRYING UK DATAStaying on top of the latest currency news can help you time your transfers more effectively, so find out what you should be looking out for over the next couple of weeks…

Latest currency news

Trade in the currency market has been erratic through the first half of June following the European Central Bank’s (ECB), Federal Reserve’s and Bank of England’s (BoE) latest interest rate decisions.

This saw GBP/EUR trade between 1.17 to 1.14, whilst propelling EUR/GBP as high as 0.87.

Meanwhile, GBP/USD slumped from 1.24 to 1.22, whilst EUR/USD retreated from 1.07 to 1.04.

What’s been happening?

The ECB’s decision saw the euro initially spike as the bank laid out plans for a July hike, before slumping amid concerns it could cause fragmentation in the Eurozone.

USD exchange rates surged higher ahead of the Fed’s June rate decision on hopes for a 75bps hike. While the Fed delivered the US dollar subsequently plunged as the bank’s forward guidance proved less hawkish than expected.

Meanwhile, the pound spiked after the BoE’s latest rate decision. While the bank opted for a modest 25bps hike this month, it hinted future hikes may be more aggressive.

What do you need to look out for?

Looking ahead, the currency market is likely to continue to trade with a with a high degree of volatility through the second half of June amid growing global recession fears.

This could see the US dollar surge amid considerable safe haven-demand while pushing the increasingly risk-sensitive pound lower, particularly amid renewed Brexit jitters.

Meanwhile, the euro could struggle as a result of European energy concerns as Russia continues to restrict gas supplies to the continent.

At Currencies Direct we’re here to talk currency whenever you need us, so please get in touch if you want to know more about the latest news or how it could impact your currency transfers. Since 1996 we have helped more than 325,000 customers with their currency transfers, so why not give us a call on 00351 289395739 to find out more or alternatively visit the website on https://www.currenciesdirect.com and register to get regular updates on the currency markets

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