GBP News: Carney’s Brexit Caution Drags on Pound Sterling Exchange Rates

Pound Sterling (GBP) Exchange Rates Muted Following Carney Warning

The Pound (GBP) struggled to find momentum yesterday as Bank of England (BoE) Governor Mark Carney appeared before Parliament’s Treasury Select Committee.

Brexit unsurprisingly dominated the meeting with Sterling left muted after Carney warned that short-term growth was being damaged by Brexit uncertainty and hinted that interest rates could be cut if the UK left the EU without a deal.

In the absence of any notable data today we are likely to see GBP exchange rates languish as the ongoing political uncertainty in the UK limits the appeal of the Pound.

GBP/EUR Exchange Rate Stable as German Consumer Confidence Sinks

The Pound Euro (GBP/EUR) exchange rate traded in a narrow range throughout Wednesday’s session following the release of some gloomy consumer confidence figures from Germany.

Sentiment was reported to be at its lowest levels since April 2017 in July, due to a slump in income expectations amid concerns of job losses in the automotive industry.

Looking ahead, this afternoon will bring the release of Germany’s latest CPI figures, which could dent the appeal of the Euro if another subdued inflation reading puts more pressure on the European Central Bank (ECB) to lower interest rates this year.

GBP/USD Exchange Rate Steady as US Durable Goods Slide

The Pound US Dollar (GBP/USD) exchange rate was range bound yesterday as US durable goods orders were reported to have contracted sharply for the second month in a row in May.

On top of this, President Trump launched another attack on the Federal Reserve in an interview with Fox News, blaming the bank’s monetary policy on undermined US growth and claiming that he has the right to remove Chairman Jerome Powell.

Coming up later this afternoon the US will publish the final release of its first quarter GDP figures, which may offer some support to the US Dollar if the economy is confirmed to have expanded by 3.1%.

GBP/CAD Exchange Rate Sinks to Eight-Month Low as Oil Prices Surge

The Pound Canadian Dollar (GBP/CAD) exchange rate struck its worst levels since early November on Wednesday, with the oil-sensitive ‘Loonie’ pushing higher again as Brent crude broke through to $66 a barrel amid rising tensions in the Middle East.

GBP/AUD Exchange Rate Slips as Risk Sentiment Improves

The Pound to Australian Dollar (GBP/AUD) exchange rate trended lower throughout yesterday’s session, before striking a four-month low overnight thanks to comments from the US Treasury secretary. Stephen Mnuchin suggested a US-China trade deal is ’90% complete’ and helped buoy demand for the risk-sensitive ‘Aussie’.

GBP/NZD Exchange Rate Slips on US-China Trade Hopes

The Pound to New Zealand Dollar (GBP/NZD) exchange rate also faltered yesterday, with the pairing falling over half a cent as the ‘Kiwi’ was underpinned by renewed US-China optimism.

Data Releases

10:00 EUR Business Confidence (Jun)
13:00 EUR German Inflation Rate (Jun)
13:30 USD GDP (Q1)

Matthew Andrews

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