Pound Sterling Exchange Rates Could Jump on Sturdy UK Jobs Data
Pound Sterling (GBP) exchange rates have generally strengthened this week, with the British currency firming against the Euro and hitting post-referendum highs against the US Dollar.
Whether or not the Pound is able to maintain this momentum next week is largely down to the UK’s key employment figures, due on Wednesday.
While a sturdy employment change number would be good news, investors will be more concerned with average weekly earnings numbers. If wage growth rises, and moves closer to the current level of inflation, Sterling could rally.
Other UK data to watch out for next week includes public sector net borrowing numbers and the Q4 growth estimate.
Will Pound Sterling to Euro (GBP/EUR) Exchange Rate Push Higher after ECB Rate Announcement?
There is the potential for the Pound Sterling to Euro (GBP/EUR) exchange rate to climb following next Thursday’s European Central Bank (ECB) interest rate decision.
The latest Eurozone inflation figures confirmed that consumer price pressures remain far below the ECB’s target levels. If policymakers respond to the report by maintaining a dovish attitude on the subject of tightening monetary policy, the Euro may record broad-based losses.
However, any EUR losses could be limited if the week’s other big Eurozone news, including the German and Eurozone ZEW economic sentiment surveys, preliminary manufacturing and services PMIs and the German IFO business confidence measures, print positively.
Interbank Pound to US Dollar (GBP/USD) Exchange Rate on Track to hit $1.40?
The interbank Pound Sterling to US Dollar (GBP/USD) exchange rate has been achieving its best levels since the UK voted to Brexit, and some economists believe the pairing could have further to climb.
If next week’s UK employment numbers provide cause for cheer, we could see GBP/USD hitting new highs.
Of course, US data will also be in focus. Next Friday’s stats are some of the most influential, and are expected to show a slowing in durable goods orders growth and an easing in QoQ expansion in the last quarter of 2017.
Pound to Canadian Dollar (GBP/CAD) Exchange Rate to Remain Elevated on NAFTA Woes
Ongoing concerns about the North American Free Trade Agreement (NAFTA) have helped the Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate consolidate gains.
The Canadian Dollar could enjoy some respite next week, however, if Canadian retail sales and inflation data give the Bank of Canada (BoC) a reason to continue with its rate hiking cycle.
Pound to Australian Dollar (GBP/AUD) Exchange Rate to be Driven by UK News
With very little Australian data due for publication next week, the Pound Sterling to Australian Dollar (GBP/AUD) exchange rate will be driven by UK news and global risk appetite.
The one domestic report with the potential to spark AUD volatility – the Westpac Leading Index – is due out on Tuesday.
NZ Inflation Data Set to Spark Pound to New Zealand Dollar (GBP/NZD) Exchange Rate Movement
A dramatic drop in New Zealand’s BusinessNZ Manufacturing PMI bolstered the Pound Sterling to New Zealand Dollar (GBP/NZD) exchange rate during the Australasian session. The gauge fell to 51.2 in December, down from 57.7. The measure is now far closer to the 50 mark separating growth from contraction.
The GBP/NZD exchange rate is likely to experience further volatility next week with New Zealand due to release its performance of services index and consumer price index.
Slowing inflation would weigh on hopes for tighter monetary policy from the Reserve Bank of New Zealand (RBNZ) and could leave the New Zealand Dollar weaker.