Pound Sterling (GBP) Exchange Rates Fluctuate on Upbeat Borrowing Figures
The Pound (GBP) initially firmed on Friday, as some upbeat government borrowing figures were welcomed by investors.
The data showed the UK government borrowed less than expected to balance the books in September, and that total borrowing for the year so far was down £10bn on the previous year, with hopes this could lead to a more generous budget from Chancellor Philip Hammond later this month.
However this meant little in face of renewed Brexit uncertainty, with Sterling ultimately closing the session lower as the deadlock in talks began to weigh on sentiment once again.
Looking to the week ahead, a lull in UK data could hamper the Pound’s attempts to rally, especially if it leaves investors to focus on Brexit.
GBP/EUR Exchange Rate Stable as Italy’s Budget Drama Continues to Weigh on Sentiment
The Pound Euro (GBP/EUR) exchange rate remained rangebound on Friday as the EU’s criticism of Italy’s draft budget left investors wary towards the single currency.
The European Commission suggested the budget put forth by Rome was an “unprecedented” breach of EU fiscal rules, raising fresh concerns of possible conflict within the Eurozone.
Things aren’t looking much better for the Euro this week either, with investors bracing for a further slowdown in the Eurozone’s private sector with the release of the bloc’s latest PMI figures, as well as another uneventful European Central Bank rate decision.
GBP/USD Exchange Rate Edges Higher as US Homes Sales Contract
The Pound US Dollar (GBP/USD) exchange rate struck a fresh two-week low during Friday’s trading session as Brexit and Italian budget concerns prompted investors to flock to the safe-haven currency.
These gains were tempered somewhat however thanks to a larger-than-expected contraction in US existing home sales.
The main focus in the week ahead will be on the latest US GDP figures, with USD investors eager to see whether the second quarter’s bumper growth will have carried through to the latter half of 2018.
GBP/CAD Exchange Rate Rallies as Canadian Inflation Underperforms
The Pound Canadian Dollar (GBP/CAD) exchange rate was one of the few Sterling pairings to register any actual gains at the end of last week, with the ‘Loonie’ facing some heavy selling pressure as Canada’s latest inflation and retail sales both underperformed.
This dip in inflation also likely kills off any chances of the Bank of Canada (BoC) voting to raise interest rates when it meets later in the week.
GBP/AUD Exchange Rate Rebounds as Risk Sentiment Plummets
The Pound Australian Dollar (GBP/AUD) exchange rate rebounded from a two-week low on Friday, with the ‘Aussie’ forced to relinquish its initial gains as rising geopolitical uncertainty began to drag on market risk appetite.
GBP/NZD Exchange Rate Volatile amid Growing Global Uncertainty
The Pound New Zealand Dollar (GBP/NZD) exchange rate met a similar fate to GBP/AUD at the end of last week, with the pairing clawing back some of the day’s initial losses as risk-sensitive ‘Kiwi’ lost out as investors flocked to safe-haven currencies.