Pound (GBP) Surges as Farage Seeks to Prevent Clash with the Tories
The Pound (GBP) spiked at the start of this week’s session in response to Nigel Farage’s announcement that the Brexit party would not stand candidates in Conservative held constituencies.
The news was cheered by GBP investors who hope it will avoid splitting the leave vote and boost the chances of the Tories securing a majority in the upcoming general election.
Also lending support to the Pound was the publication of the UK’s latest GDP estimate on Monday, with the UK avoiding a recession as growth rebounded in the third quarter.
Looking ahead, Sterling may be forced to relinquish some of these gains this morning if the UK’s latest jobs report shows that the labour market is slowing.
GBP/EUR Exchange Rate Spikes, Focus on UK Politics
The Pound Euro (GBP/EUR) exchange rate jumped to a six-month high on Monday as UK election speculation lit a fire under the pairing.
This uptrend may persist through today’s session with the publication of the ZEW economic sentiment survey for the Eurozone.
Economists forecast that the Eurozone’s outlook will have grown even gloomier in November, with another drop in the index putting more pressure on the Euro.
GBP/USD Exchange Rate Strengthens, US-China Trade Concerns Weigh
The Pound to US Dollar (GBP/USD) exchange rate was catapulted higher during yesterday’s session as renewed concerns over US-China trade left the ‘Greenback’ unable to fend off a resurgent Sterling.
With Donald Trump apparently reluctant to rollback tariffs, analysts fear a ‘phase 1’ deal may be at risk.
USD also appeared side-lined as markets brace for Jerome Powell’s upcoming testimony in front of the Joint Economic Committee on Wednesday, in which the Chairman of the Federal Reserve will be grilled about the bank’s monetary policy and the state of the US economy.
GBP/CAD Exchange Rate Soars as Oil Prices Stall
The Pound to Canadian Dollar (GBP/CAD) exchange rate rocketed up by roughly a cent on Monday, with the oil-sensitive ‘Loonie’ struggling to hold its ground as oil prices remained flat as a result on ongoing trade uncertainty.
GBP/AUD Exchange Rate Lower as Australian Business Confidence Improves
The Pound to Australian Dollar (GBP/AUD) exchange rate pulled back from a two-week high overnight on Monday as the ‘Aussie’ was buoyed by a surprise uptick in domestic business confidence in October.
GBP/NZD Exchange Rate Surges as RBNZ Inflation Expectation Misses
The Pound to New Zealand Dollar (GBP/NZD) exchange rate jumped around a cent overnight after the Reserve Bank of New Zealand’s (RBNZ) inflation expectations came in below forecast for the fourth quarter.
This feeds into expectations the RBNZ will announce another rate cut later tonight, with the ‘Kiwi’ expected to slump if the bank signals that there may be more easing to come.