Downward revision of Q1 UK GDP threatens GBP/USD

Downward revision of Q1 UK GDP threatens GBP/USD

 

Sinduja Venkat

Good morning and welcome to today’s foreign exchange market commentary on 27th of June. 

Here are MyCurrencyTransfer.com’s top 5 currency highlights:

  • Downward revision of Q1 UK GDP threatens GBP/USD
  • EUR/GBP romps ahead on string German data and disappointing UK GDP print
  • Dudley assures of Fed support if US economy malfunctions
  • Yen weaker on US pending home sales
  • AUD/USD modestly impacted by Rudd’s win

CURRENCY RATES OVERVIEW 

GBP/EURO – 1.1697
GBP/USD – 1.5219
GBP/CHF – 1.4423
GBP/CAD – 1.5946
GBP/AUD – 1.6372
GBP/ZAR – 15.1680
GBP/JPY – 149.9138
GBP/HKD – 11.8067
GBP/NZD – 1.9493
GBP/SEK – 10.2533

Mid-market rates as of 2013-06-27 14:25 UTC

Key releases in the next 24 hours that may affect currency date:

Australia: No Data
Europe: EUR EU Leaders Hold Summit in Brussels, EUR German Unemployment Change (JUN), EUR German Unemployment Rate s.a. (JUN), EUR Euro-Zone Business Climate Indicator (JUN), EUR Euro-Zone Consumer Confidence (JUN F), EUR Euro-Zone Industrial Confidence (JUN), EUR Euro-Zone Services Confidence (JUN)
United Kingdom:  GBP Gross Domestic Product (QoQ) (1Q F), GBP Gross Domestic Product (YoY) (1Q F)
New Zealand: NZD NBNZ Business Confidence (JUN)
United States of America: USD Initial Jobless Claims (JUN 22), USD Personal Consumption Expenditure Core (YoY) (MAY), USD Personal Consumption Expenditure Deflator (YoY) (MAY), USD Personal Income (MAY)
China: CNY Industrial Profits YTD (YoY) (MAY)
Canada: No Data
Japan: No Data

Downward revision of Q1 UK GDP threatens GBP/USD

During today’s European trading session Sterling weakness was the main story following a dip in UK GDP figures for the first quarter. GBP/USD pair dropped sharply dipping to its lowest level in the past three weeks at 1.5261. GDP figures were reported at 0.3 per cent versus the 0.6 per cent year on year growth as well as a similarly expected figure by the markets. However, month on month figures were found to be in line with expectations which was offset by a widening of the Current Account.

EUR/GBP romps ahead on string German data and disappointing UK GDP print

EUR/USD pair trading was observed to be flat overall during today’s European session with the pair trading at around 1.3000. Better than expected German employment data and EMU confidence surveys have yet to make an impact on the pair. USD/CHF pair advanced right up to a fresh 3-week high of 0.9462 while the EUR/GBP ascended to 0.8535 after release of UK GDP figures.

Dudley assures of Fed support if US economy malfunctions

CEO of the Federal Reserve Bank of New York William Dudley has indicated today that the US monetary easing program could resume for a longer time if the economic situation in the US as well as the global markets demanded it. He indicated than an appropriate time to resume tapering  would be late 2013. Dudley also assured that if the case were such that US economy performs worse than expected the central bank would expand its asset purchase program further. US stocks as well as the USD appreciated on the news.

Yen weaker on US pending home sales

USD/JPY advanced higher and printed a fresh high after US pending home sales for May pushed the bar to post the highest level in over six years.

AUD/USD modestly impacted by Rudd’s win

The AUD is dragging on at 0.9300 after hitting highs around 0.9340 overnight. However there have been no data releases from the Aussie economy off late.  In other news K.Rudd has been elected new Labour party leader on Wednesday Labor after J.Guillard. As Labour party leader K Rudd is seen to have ample possibilities to become the next PM of Australia. The equities and currency markets has reacted to the news modestly so far.

 

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