Forex Weekly Round Up 22/2/16 – 26/2/16

The fragile pound lost nearly 1% against the US dollar on Monday with further uncertainty over Britons EU membership. Furthermore, the UK Inflation Report made clear that the Bank of England could cut interest rates to zero if the UK was put in a “position where the economy needed additional stimulus”. However, in Carney’s words, there was “no intention and no interest” towards setting negative interest rates such as the likes of Japan and Switzerland to boost growth and inflation.

Increasing anxiety of the Brexit drove sterling down to a new seven year low. We saw the pound fall to its lowest levels since February 2009 against the US dollar. We also saw GBPEUR drop by 0.58%. The pound tumbled further as cabinet ministers clashed over the legal strength of Britain’s new deal with Europe.

UK GDP came out in line with analyst expectations at 1.9% and Sterling licked its wounds near a seven-year low against the dollar after three tumultuous days since Prime Minister David Cameron called a referendum on Britain’s EU membership for 23rd June. The pound was up 0.3% on Thursday but remains around 3% lower this week against the dollar, with a test of its 2009 low of $1.35 within sight.

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Here are the exchange rates taken at 13:54 today. Please note that all conversions are based on interbank rates without any spreads and should be used only as a guide. For live ‘spot’ and ‘forward’ prices please feel free to drop us a line.

GBP/USD 1.3965
GBP/EUR 1.2724
USD/EUR 0.9111