Pound Sterling (GBP) Exchange Rate Subdued Following Dip in Wage Growth but Traders Await Federal Reserve Rate Hike News
The Pound (GBP) made an abortive attempt to rally against its peers on Tuesday as the currency failed to hold on to its gains following the release of some mixed employment figures.
While markets welcomed the news that UK employment struck a record high in April, investors were less impressed by the accompanying wage figures as wage growth unexpectedly slipped back, weakening Sterling sentiment on suggestions it would dent the chances of a Bank of England rate hike in 2018.
However Sterling was able to rebound at the end of the day’s session as the UK government managed to pass its Brexit withdrawal bill.
The Pound may make another attempt to advance during Wednesday’s session as data is expected to reveal UK inflation rebounded in May.
GBP/EUR Exchange Rate Fluctuates as Economists Give Bleak Outlook for Eurozone
The Pound Euro (GBP/EUR) exchange rate was met by volatility during yesterday’s session, with the pairing briefly edging to a new one-month low, despite a gloomy outlook for the Eurozone.
A survey of leading economists, published by ZEW in Germany, revealed optimism in the Eurozone has taken a significant hit this month, with fears over escalating trade tensions with the US appearing to be a major drag on sentiment.
GBP/USD Exchange Rate Flat as US Inflation Surges
The Pound US Dollar (GBP/USD) exchange rate also failed to advance on Tuesday as currency markets reacted to the latest US inflation figures.
US inflation was shown to have accelerated from 2.5% to 2.8% in May, outpacing forecasts of a rise to 2.7% and reaching its highest levels since 2012.
However the data proved to be less impactful on USD than first thought, with investors reluctant to alter their positions in the US Dollar ahead of today’s Federal Reserve policy meeting, which is expected to see the bank vote for its second rate hike of the year.
GBP/CAD Exchange Rate Muted as NAFTA Concerns Drag
The Pound Canadian Dollar (GBP/CAD) exchange rate traded in a narrow range yesterday as the UK’s lacklustre wage figures were offset by renewed concerns over ongoing NAFTA negotiations.
President Trump has considerably stepped up his trade rhetoric in recent days, particularly in regards to Canada, which he accuses of ripping off the US with unfavourable trade deals, something which observers suggest does not bode well for talks.
GBP/AUD Exchange Rate Rallies as Fed Speculation Takes Hold
The Pound Australian Dollar (GBP/AUD) exchange rate rallied sharply on Tuesday evening, as market risk appetite fell sharply on hints the Federal Reserve could now begin to hold a press conference after every policy meeting, something which will increase the opportunities for the bank to raise interest rates.
GBP/NZD Exchange Rate Buoyed by Drop in Risk Sentiment
The Pound New Zealand Dollar (GBP/NZD) exchange rate told a similar story to its antipodean cousin on Tuesday, with the reduced demand for risk-correlated currencies weighing heavily on the ‘Kiwi’.