Pound Sterling (GBP) Exchange Rates Calm Following No-Confidence Vote
The Pound (GBP) steadied on Wednesday, with Sterling remaining calm after Theresa May’s government narrowly survived a no-confidence vote yesterday evening.
While GBP investors will be relieved that the UK will avoid a general election for now, there appeared to be limited upside to the Pound, given the heightened uncertainty surrounding Brexit.
May is now calling for cross-party talks to try and reach a consensus on Brexit, but ultimately the path forward remains unclear, likely capping movement in the GBP for the time being.
GBP/EUR Exchange Rate Buoyed as Draghi Comments Continue to Exert Pressure on Euro
Ahead of the of vote, the Pound Euro (GBP/EUR) exchange rate ticked higher during Wednesday’s session as the single currency continued to feel the drag of some dovish comments from European Central Bank (ECB) head Mario Draghi.
This saw Draghi suggest that recent economic developments have been disappointing and pointed to the need for further monetary stimulus amid global economic uncertainty.
EUR exchange rates are likely to remain on the back foot throughout Thursday as well, with the latest Eurozone CPI figures expected to confirm inflation tumbled in December.
GBP/USD Exchange Rate Steady amid Shutdown Concerns
The Pound US Dollar (GBP/USD) exchange rate was rangebound yesterday, with USD struggling to find support due to growing concerns over the impact of the ongoing US federal government shutdown.
Recent figures have suggested the shutdown has had a greater impact on growth than initially expected, and this has prompted some speculation about a potential contraction in GDP in the first quarter.
These concerns over US growth may be made worse by the release of the latest US manufacturing index data, with another lacklustre Philadelphia index potentially dragging on the US Dollar.
GBP/CAD Exchange Rate Muted as Oil Prices Stabilise
The Pound Canadian Dollar (GBP/CAD) exchange rate traded in a narrow range yesterday, with neither currency able to find any momentum throughout the European session as oil prices steadied after days of fluctuations.
GBP/AUD Exchange Rate Dips on Chinese Stimulus Hopes
The Pound Australian Dollar (GBP/AUD) exchange rate soared higher on Wednesday following another warning on Chinese growth, this time coming from Chinese Premier Li Keqiang who suggested China must prepare for difficulties this year. This added to pressure on AUD from earlier in the session after a sharp drop in domestic consumer confidence.
GBP/NZD Exchange Rate Strengthens as NZ Card Spending Tumbles
The Pound New Zealand Dollar (GBP/NZD) exchange rate moved in a similar range to the Australian Dollar on Wednesday, with the ‘Kiwi’ also slumping as China warned of increasing pressures on its domestic economy, reflected in the latest electronic card spending figures, which revealed a marked decline.