Yesterday Euro area industrial production data showed a significant drop in July, by 1.5% versus the previous month, sending a negative signal for Q3 GDP growth. However GBP failed to make significant gains on the back of this news with GBP/EUR still hovering below the very significant 1.1900 level.
This afternoon sees Retail Sales figures and Consumer confidence figures released in the US. These figures make for a potentially volatile afternoon for currency pairs involving USD. Although this data is insignificant compared to what awaits us next week...
So looking ahead to next Wednesday evening (UK time) we have the event of the year - at least it feels like that - with the US FOMC meeting potentially delivering an answer on tapering (slowly reducing the stimulus pumped into the US economy). This decision has been speculated upon for months now, indeed the market started to price in their expectations way back in March. The current expectation is for the Federal Reserve to announce that they will reduce the stimulus by 10 billion dollars - a bigger figure than this will rapidly strengthen the USD and instead of looking for GBP/USD to move to 1.60 we could see a rapid dive towards 1.50. Why? well its simple supply and demand, tapering effectively reduces the supply of USD, and when supply is reduced this drives up price.
Posted in Daily Market News on May 30 2014
Yesterdays strong employment figures from the UK gave GBP a boost, particularly against USD with cable toying with the 1.5800 mark. The number of people out of work fell by 24,000.00 in the three months to July. The headline unemployment rate thus fell from 7.8% to 7.7%.VIEW FULL ARTICLE
Posted in Daily Market News on Sep 12 2013 by alex