SendMoney.org.uk

Compare exchange rates, send money abroad and online

Wed 3 Jun 2020 08:32GMT

?Loonie? Sinks on Global Oil Glut Fears, Pound Dominant due to Market Uncertainty Today

Published: 19 Oct at 5 PM Tags: Euro, Dollar, Pound Sterling, America, Eurozone, Australian Dollar, New Zealand Dollar, Canadian Dollar, Australia, New Zealand, USA, Canada, China,

Pound Sterling
Although the Rightmove House Prices figure showed a decline on the month, falling to 5.6% from 6.4% in September, this failed to particularly weigh on the Pound today. Investors have remained generally optimistic towards Sterling after Friday’s hawkish comments from Monetary Policy Committee (MPC) member Kristin Forbes, with the currency also benefitting from an atmosphere of general market uncertainty that has seen it making gains across the board on Monday.

Euro
Sentiment towards the single currency has been rather mixed today, as the morning’s slowed Chinese GDP figure initially spurred an increase in demand for the safe-haven asset. A sharper contraction than expected in August’s Eurozone Construction Output saw the Euro slump against rivals, however, as pundits speculated on the prospect of the European Central Bank (ECB) being prompted to introduce fresh monetary loosening policies as a result of this sustained economic decline. Nevertheless, the more reluctant attitude of the central bank to engage in such policies has prevented this disappointment from having a sustained negative impact upon the Euro, with risk aversion boosting the common currency anew.

US Dollar
After Friday’s stronger than expected University of Michigan Confidence Index reading the ‘Greenback’ was bolstered further today by the evidence of continued contractions in the Chinese economy. With traders inclined to favour lower-yielding currencies as opposed to their more risk-sensitive rivals the US Dollar saw a surge in demand, even as debate continued as to the odds of a December move from the Federal Open Market Committee (FOMC). Bettering forecast this afternoon, the NAHB Housing Market Index also lent some additional strength to the ‘Buck’ as it advanced against the majority of rivals.

Australian Dollar
With base metal values sliding in response to the mixed impressions of the third quarter Chinese GDP result, investors foreseeing a greater contraction in demand due to the increasing slowness of the world’s second largest economy, trade on the ‘Aussie’ turned bearish. The prospect of a near-term cut in interest rates by the Reserve Bank of Australia (RBA) would appear to still be on the table, keeping the antipodean currency softened ahead of tonight’s October meeting minutes from the central bank.

New Zealand Dollar
The commodity-correlated ‘Kiwi’ has also been faring badly amidst the general sell-off in riskier assets today, as speculation has turned back towards the possibility of the Reserve Bank of New Zealand (RBNZ) slashing interest rates again before the end of the year in spite of recent hawkish comments from Governor Graeme Wheeler. Although the New Zealand Services PMI did show improvement overnight, rising from 58.5 to 59.3, this was not sufficient to counter these latest global slowdown concerns.

Canadian Dollar
Oil joined the general commodity slump this morning, spurred downwards by discouraging comments from the Iranian Oil Minister as well as the evident decrease in Chinese demand. His intimation that there would be no change in production from the Organisation of the Petroleum Exporting Countries (OPEC) as Iran prepares to return to its pre-sanction levels of output naturally worried investors. With the global supply glut unlikely to ease this pushed Brent crude back to $49.03 per barrel as the ‘Loonie’ similarly downtrends.
As of Monday, 19th October 2015, the Pound Sterling currency rates mentioned within this news item were as follows:

GBP EUR exchange rate was 1.3654, GBP USD exchange rate was 1.5467, GBP AUD exchange rate was 2.1342, GBP NZD exchange rate was 2.2759, GBP CAD exchange rate was 2.0135, and GBP CNY exchange rate was 9.837.
Patrick James About Author: (289 Posts)Patrick completed his economics degree just as the global financial crisis struck in 2008. In the intervening years Patrick has made his mark, climbing to a prominent position within a large financial services provider. As part of his role Patrick uses his expertise to advise companies of the best ways to safeguard against currency risk.

Live Exchange Rates