USD rallies against Sterling ahead of all-important FOMC meet

USD rallies against Sterling ahead of all-important FOMC meet

Sinduja Venkat

Good morning and welcome to today’s foreign exchange market commentary on 18th of June. 

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

  • GBP dips on strong US consumer data
  • EUR rallies against Greenback ahead of FOMC Meet
  • US markets boosted by strong investor confidence
  • Strong greenback pushes JPY/USD higher
  • AUD stumbles for third consecutive session

CURRENCY RATES OVERVIEW 

GBP/EURO – 1.1673
GBP/USD – 1.5649
GBP/CHF – 1.4386
GBP/CAD – 1.5971
GBP/AUD – 1.6484
GBP/ZAR – 15.6567
GBP/JPY – 149.0087
GBP/HKD – 12.1413
GBP/NZD – 1.9550
GBP/SEK – 10.0767

Mid-market rates as of 2013-06-18 18:26 UTC

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

Australia: No Data
Europe: EUR Euro-Zone ZEW Survey (Economic Sentiment) (JUN), EUR German ZEW Survey (Current Situation) (JUN), EUR German ZEW Survey (Economic Sentiment) (JUN)
United Kingdom:  GBP Producer Price Index Output n.s.a. (YoY) (MAY), GBP Producer Price Index Output Core n.s.a. (YoY) (MAY), GBP Consumer Price Index (MoM) (MAY), GBP Consumer Price Index (YoY) (MAY), GBP Retail Price Index (YoY) (MAY)
New Zealand: No Data
United States of America: USD Consumer Price Index (MoM) (MAY), USD Consumer Price Index Ex Food & Energy (MoM) (MAY), USD Consumer Price Index (YoY) (MAY), USD Consumer Price Index Ex Food & Energy (YoY) (MAY), USD Housing Starts (MoM) (MAY), USD Building Permits (MoM) (MAY)
China: No Data
Canada: No data
Japan: JPY Merchandise Trade Balance Total (Yen) (MAY)

GBP dips on strong US consumer data

GBP/USD dipped on Tuesday after data from US posted an increase in consumer prices in May which was in line with expectations. However US housing data continued to disappoint. The pair is trading in the 1.5575 region representing a dip of over 0.9% during Tuesday trading. According to JP Morgan Market Analysts the odds remain in favor of a major decline in GBP/USD. This is despite strong economic data coming out of UK during yesterday’s session. UK CPI had rebounded in May, rising from 2.4% to 2.7%  on a year on year basis making this result in line with market forecasted figures.

EUR rallies against Greenback ahead of FOMC Meet

EUR/USD pair settled at 1.3400 on Tuesday before heading towards New York session close. The currency is expected to experience frenetic activity tomorrow at the close of the two day FOMC meeting which will conclude with Fed Chairman Bernanke’s statements regarding the likelihood of the Fed cutting back on its monthly asset purchases. Market observers have indicated that if the Fed signals that it will sustain a high pace of quantitative easing the outcome would be stronger performance from US equities and US bonds whereas the USD would weaken. The EUR/USD pair is currently going strong with an increase of 0.24% at over 1.3400.

US markets boosted by strong investor confidence

USD rallied against all its peers save for the EUR on Tuesday. Markets remained focused on the outcome of the Fed’s FOMC meet to be released on Wednesday. Overall investor’s confidence continued to remain positive owing to consumer data results from US matching expectations. US stocks also had a field day with most equities appreciating.

Strong greenback pushes JPY/USD higher

Japanese trade balance figures for May was higher than estimated but lower than the previous month’s figures at ¥-993.9 billion. Year on year May imports were pegged at an increase of 10.0%  compared to an increase of 10.8% expected, with exports doing better than expected, at +10.1% in May vs +6.5% expected. JPY/USD pair was up once again during Tuesday’s session at 95.55 owing to Yen weakness

AUD stumbles for third consecutive session

AUD/USD pair stumbled for the third consecutive trading session and lost close to 53 pips and ended the day at 0.9484. RBA minutes released yesterday convey that there is further scope for quantitative easing.  The minutes for its June Board meeting when it had left the cash rate unchanged at 2.75% has not however provided any clear insight in to AUD outlook for the near term.

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