Pound Sterling (GBP) Exchange Rates Slump as Brexit Jitters Rise
Brexit uncertainty dominated investor sentiment once again on Wednesday, leading to further pressure against the Pound (GBP) and prompting the currency to cede ground against the majority of its peers.
This renewed uncertainty comes as a result of investors becoming increasingly sceptical of Theresa May’s chances of getting a possible extension to Britain’s transition deal through Parliament.
However while the short-term outlook for GBP is looking increasingly bleak, analysts remain optimistic that Sterling could move sharply higher should positive Brexit progress be made.
GBP/EUR Exchange Rate Steady as Eurozone PMI Data Disappoints
The Pound Euro (GBP/EUR) exchange rate was one of the few Sterling pairings not to register any losses yesterday, as the latest Eurozone PMI figures also saw investors shun the single currency.
Data published on Wednesday showed that growth in the bloc has fallen to a new two-year low this month, with an easing of export dragging on expansion.
The figures were seen as particularly damaging to the Euro due to fears that they could lead the European Central Bank (ECB) to strike a more dovish tone following this week’s policy meeting.
GBP/USD Exchange Rate Slumps Below $1.28
The Pound US Dollar (GBP/USD) exchange rate fell to a six-week low yesterday, with the weakness observed in Sterling and the Euro fueling demand for USD.
However the ‘Greenback’ fell from its best levels later in the afternoon after US new home sales slowed by more than expected in Sept.
Looking ahead the US Dollar may be forced to relinquish some more ground during Thursday’s session, with economists forecasting the latest US durable goods figures will reveal that orders contracted sharply in September.
GBP/CAD Exchange Rate Drops as BoC Hikes Interest Rates
The Pound Canadian Dollar (GBP/CAD) exchange rate plummeted around a cent on Wednesday as markets cheered the Bank of Canada’s (BoC) decision to hike interest rates.
Bank of Canada increases overnight rate target to 1 ¾ per cent #cdnecon https://t.co/2UorGytiXM
— Bank of Canada (@bankofcanada) October 24, 2018
While the hike did not come as a surprise to investors, the bank’s decision to remove its reference to ‘gradual’ monetary tightening was seen as a notable development.
GBP/AUD Exchange Rate Fluctuates as Risk Sentiment Slides
The Pound Australian Dollar (GBP/AUD) exchange rate traded in a wide range on Wednesday as a deterioration in risk sentiment led to volatility in the ‘Aussie’.
GBP/NZD Exchange Rate Rallies as NZ Trade Deficit Expands
After touching a new three-week low yesterday afternoon, the Pound New Zealand Dollar (GBP/NZD) exchange rate began to creep back up overnight following a surprise rise in New Zealand’s trade deficit.