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Tue 27 Feb 2024 11:04GMT

Pound Sterling Crashes as BoE Paints Gloomy Picture

Published: 5 Jul at 12 PM Tags: Euro, Dollar, Pound Sterling, America, UK, Eurozone, Australian Dollar, New Zealand Dollar, Canadian Dollar, Australia, New Zealand, USA, Canada, Ireland, Italy,

Pound Sterling (GBP)
Sterling has been in a widespread state of decline against its peers today, on account of the major Bank of England (BoE) news consisting of a warning-laden report on the current and future state of the UK economy.
The first financial stability report released since the ‘Brexit’ decision that came on June 23rd has done little to encourage investment in the Pound or the UK economy.
Looking ahead, the Pound could be influenced on Thursday by the industrial and manufacturing production results for May, which are crucially forecast to drop on the year in both cases.
During the European session the interbank Pound Sterling to Euro (GBP/EUR) exchange rate was in the region of 1.1791

Euro (EUR)
The single currency has been divided overall against its peers recently, with gains prevailing for the most part. The Euro was earlier shifted by a number of composite and services PMI releases for June, as well as the retail sales results for May.
In the former case, only Spain and Italy managed to make real gains, while in the latter, a far more positive result was recorded on the whole.
Looking ahead, Ireland will shortly be releasing its consumer confidence result for June, which has a rise forecast from 98.1 to 99.8.
Even further on, the common currency will be potentially negatively influenced by European Central Bank (ECB) President Mario Draghi’s speech tomorrow morning.
During the European session the interbank Euro to Pound Sterling (EUR/GBP) exchange rate was in the region of 0.8474

US Dollar (USD)
The US Dollar has been a favourable option on the second day of the week, with the limiters now off after Monday’s 240th Independence Day celebrations.
With no US data out until the afternoon today, economists have been occupying the downtime by speculating on how the EU Referendum result could impact the Dollar in the long-term.
The consensus has been mixed overall, with more optimistic economists speculating that the worst is already past and the less positive forecasters putting slow or falling growth as something still to come in the US.
This afternoon will see the announcement of the US’s durable goods and factory orders for May, which have both been predicted to have negative outcomes.
During the European session the interbank US Dollar to Pound Sterling (USD/GBP) exchange rate was in the region of 0.7603

Australian Dollar (AUD)
The Australian Dollar has flopped on the whole recently, with the national election continuing to hang in the balance.
At last consultation, around ten seats were still to be declared, which is fatefully the same number that would break the deadlock and see a majority party declared for the governance of Australia.
Tomorrow morning will bring a Reserve Bank of Australia (RBA) speech from official Guy Debelle, who is expected to make a statement on the recent decision by the RBA to leave the interest rate at 1.75%.
During the European session the interbank Australian Dollar to Pound Sterling (AUD/GBP) exchange rate was in the region of 0.5700

New Zealand Dollar (NZD)
The ‘Kiwi’ has managed to claw back a few gains against peers today, although for the most part the New Zealand currency has been making mixed movements against its regular peers.
The price of milk has been a crucial issue for investors in the ‘Kiwi’, with the latest drop off doing little to generate enthusiasm ahead of the afternoon’s national dairy auction for the first week of July.
During the European session the interbank New Zealand Dollar to Pound Sterling (NZD/GBP) exchange rate was in the region of 0.5472

Canadian Dollar (CAD)
The value of the ‘Loonie’ has dropped off for the most part against its usual rivals recently, with a sharp decline in the price of crude oil on the WTI index doing little to bolster the prospects of the Canadian currency.
In addition to this commodities news, the Canadian Dollar has also been lowered in appeal by the RBC manufacturing PMI for June falling from 52.1 to 51.8.
During the European session the interbank Canadian Dollar to Pound Sterling (CAD/GBP) exchange rate was in the region of 0.5890

As of Tuesday, 5th July 2016, the Pound Sterling currency rates mentioned within this news item were as follows:

GBP EUR exchange rate was 1.1747, GBP USD exchange rate was 1.2994, GBP AUD exchange rate was 1.745, GBP NZD exchange rate was 1.8215, and GBP CAD exchange rate was 1.6891.
Dominic Lee About Author: (474 Posts)With over ten years experience as an economist – including four years spent as a chief economist with a major currency broker – Dominic has acquired a wealth of knowledge which he uses to forecast market movements. Dominic now works as an independent business advisor and writes for several financial publications.

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