Pound Sterling (GBP) Exchange Rates Shaken by Tory Resignations
The Pound (GBP) got off to a poor start this week, trending lower against the majority of its peers as a number of top Conservatives prepared to resign as they brace for what is widely expected to be Boris Johnson’s victory in the Tory leadership contest.
The results of the election are scheduled to be published later today, with Sterling sentiment likely to dip as a Johnson premiership is expected to increase the risks of a no-deal Brexit.
Also potentially impacting the Pound today will be a speech by the Bank of England’s (BoE) Andy Haldane, with Sterling potentially weakening if Haldane appears dovish in his outlook for monetary policy.
Pound Sterling to Euro (GBP/EUR) Exchange Rate Losses Capped by ECB Speculation
Whilst the Pound to Euro (GBP/EUR) exchange rate trended lower on Monday, this was mostly on the back of the dip in Sterling, with the single currency broadly muted against its other peers as a result of European Central Bank (ECB) speculation.
The ECB is holding its July policy meeting this week and analysts are split on whether the back will simply alter its forward guidance this month, or whether it will attempt to stay ‘ahead of the curve’ by announcing a rate cut of 10 basis points on Thursday.
Coming up later this afternoon we have the publication of the Eurozone’s latest consumer confidence figures, which could see the Euro move lower if sentiment in the bloc grew increasingly gloomy this month.
Pound Sterling to US Dollar (GBP/USD) Exchange Rate Mixed as Trump Tweets Fed Criticism Again
The Pound to US Dollar (GBP/USD) exchange rate was initially placed on the defensive yesterday as tempered Federal Reserve rate cut bets helped to strengthen the ‘Greenback’.
However, the US Dollar was forced to relinquish some of these gains later in the day as Donald Trump waded into the interest rate debate once again, with his continued Twitter attacks on the Fed appearing to undermine confidence in the bank’s independence.
It is far more costly for the Federal Reserve to cut deeper if the economy actually does, in the future, turn down! Very inexpensive, in fact productive, to move now. The Fed raised & tightened far too much & too fast. In other words, they missed it (Big!). Don’t miss it again!
— Donald J. Trump (@realDonaldTrump) July 22, 2019
In focus for USD investors today will likely be the latest US housing data, which could exert some pressure on the US Dollar if existing homes sales fell in line with expectations in June.
Pound Sterling to Canadian Dollar (GBP/CAD) Exchange Rate Dips as Oil Prices Rally
The Pound to Canadian Dollar (GBP/CAD) exchange rate drifted lower through most of yesterday’s European session, with the oil-sensitive ‘Loonie’ accelerating thanks to a convincing rally in crude prices.
Pound Sterling to Australian Dollar (GBP/AUD) Exchange Rate Boosted by US-China Trade Optimism
The Pound Australian Dollar (GBP/AUD) exchange rate weakened on Monday as the risk sensitive ‘Aussie’ found support from positive headlines regarding US-China trade negotiations.
The South China Morning Post reported that US trade officials will soon meet with Chinese Vice-Premier Liu He for the first face-to-face meeting since May, stoking hopes that talks are progressing in a positive direction.
Pound Sterling to New Zealand Dollar (GBP/NZD) Exchange Rate Rebounds on RBNZ Chatter
The Pound to New Zealand Dollar (GBP/NZD) exchange rate also initially fell back yesterday before rallying overnight following comments from the Reserve Bank of New Zealand as it hinted at potentially deploying some quantitative easing in the near future.
Looking ahead, any further upside in NZD exchange rates may be capped later tonight, with New Zealand’s latest trade figures expected to show the country’s trade surplus narrowed last month.