Pound Sterling (GBP) Exchange Rates Soften as EU Plays Hardball with May
The Pound (GBP) slumped at the end of last week’s session as Theresa May failed to secure any concessions on the Irish backstop from the EU following her trip to Brussels.
May’s attempts to salvage her Brexit deal suffered a blow at the EU summit as her European counterparts said the agreement was ‘not open for renegotiation’.
Looking ahead Sterling will be hoping for some Brexit relief this week, with GBP investors potentially turning their attention to the Bank of England’s (BoE) upcoming rate decision.
GBP/EUR Exchange Rate Steady as Eurozone PMIs Disappoint
The Pound Euro (GBP/EUR) exchange rate traded in a narrow range on Friday as Sterling’s weakness was offset by a broad fall in the Euro.
This came on the back of the Eurozone’s latest PMI figures which revealed the bloc’s private sector expanded at its slowest pace for four year, partly due to business activity in France contracting as a result of the ongoing ‘Yellow Vest’ protests.
This weakness in the single currency may also carry through to the start of this week’s session, with the Eurozone’s latest CPI figures expected to confirm inflation slowed to a five-month low in November.
GBP/USD Exchange Rate Tumbles as Risk Appetite Drops
The Pound US Dollar (GBP/USD) exchange rate slumped over half a cent at the end of last week’s session as concerns over a slowdown in China prompted a sharp drop in risk appetite.
The release of the latest US retail sales figures also help to lift the US Dollar on Friday, with an upwards revision to October’s reading welcomed by investors.
On top if this the ‘Greenback’ was also bolstered by rate hike expectations ahead of the Federal Reserve rate decision on Wednesday, which is likely to have a major influence on USD exchange rates throughout the first half of the week.
GBP/CAD Exchange Rate Weakens Despite Slide in Oil Prices
The Pound Canadian Dollar (GBP/CAD) exchange rate slipped around 0.5% on Friday, with the broad weakness in Sterling more than making up for the slide in crude prices that dragged on the oil-sensitive ‘Loonie’ against its other peers.
GBP/AUD Exchange Rate Muted despite Risk Off
The Pound Australian Dollar (GBP/AUD) exchange rate held steady at the end of the week despite the surge in safe haven demand, with broad Pound weakness limiting what GBP/AUD could achieve.
GBP/NZD Exchange Rate Fails to Take Advantage of Global Trade Jitters
The Pound New Zealand Dollar exchange rate was a similar story to GBP/AUD, with risk-off sentiment failing to benefit GBP/NZD to the full extent following Theresa May’s lack of success with the EU.