Published: 24 Jul at 12 PM Tags: Euro, Dollar, Pound Sterling, America, UK, Eurozone, USA, China, France, Germany, Greece,
Pound Sterling (GBP)
After Thursday’s disappointing retail sales data caused the Pound to slump versus its major rivals, the UK asset advanced on Friday morning. This was mainly due to better-than-expected mortgage approvals data. BBA Loans for House Purchase was forecast to advance from 42876 to 43300 in June, but the actual result climbed to 44488.
Richard Woolhouse, Chief Economist at the BBA, said: ‘The housing market is beginning to hot up again, as we’ve seen a pick-up in the number of mortgage approvals for the last month. Interestingly, we’ve also seen an increase in the number of people remortgaging, which could be down to savvy borrowers taking advantage of competitive deals on fixed rate mortgages ahead of a possible rise in interest rates.’
The shared currency edged lower versus its major competitors during Friday’s European session thanks to economic data missing median market forecasts. Manufacturing, Services and Composite PMIs for France
and the Eurozone all failed to meet with the respective market consensuses.
Commenting on the Eurozone Composite PMI, Markit’s Chief Economist Chris Williamson stated; ‘Although business confidence in the service sector hit the lowest so far this year, recent positive developments in relation to Greece
suggest the pace of growth could pick up again in coming months. The region should therefore enjoy growth of at least 1.5% this year providing there is no re-escalation of ‘Grexit’ worries, which is of course by no means assured. Deflation worries should also be allayed further by average prices charged for goods and services steadying in July, the survey gauge rising tantalisingly close to the neutral level to buoy hopes that August will see prices rising for the first time in three-and-a-half years.’
US Dollar (USD)
In response to Thursday’s positive labour market data results, the US Dollar rallied versus its major peers. The ‘Greenback’ (USD) continues to strengthen during Friday’s European session as traders weigh the likelihood of a fourth-quarter Federal Reserve benchmark interest rate hike. Additional gains can be linked to dampened market sentiment after contracting factory output from China
provoked fears of a slowdown in the world’s second-largest economy.
US New Home Sales data, due for publication later on Friday afternoon, has the potential to provoke changes for the US asset.
As of Friday, 24th July 2015, the Pound Sterling currency rates mentioned within this news item were as follows:
GBP EUR exchange rate was 1.4121, GBP USD exchange rate was 1.551, and GBP CNY exchange rate was 9.6311.