Forex Weekly Round Up 23 November 2015 – 27 November 2015
Bank of England governor Mark Carney said that the UK interest rates are likely to remain low “for some time”. UK rates have been held at 0.5% since March 2009. Most economists are not expecting the Bank to raise rates until mid-2016 at the earliest.
Also, according to another poll on Wednesday, it is anticipated The Bank of England will raise interest rates in the second quarter of next year but the timing may rest on whether the US Federal Reserve tightens policy in the world’s largest economy next month.
George Osborne’s Autumn Statement stated that they expect the UK economy to grow by 2.5% in 2016 and 2.4% in 2017, revised up from 2.3% and 2.4% respectively. Unemployment is set to fall next year and stay there until 2017 when it is set to rise. He is also made a U-turn on controversial and unpopular tax credit cuts.
Sterling fell back towards a seven-month low against the dollar on Thursday, with upbeat UK forecasts and a spending review by the Chancellor the previous day not changing the view that interest rates will not rise any time soon. The pound had initially climbed on Wednesday after George Osborne’s Autumn Statement, in which he eased some spending cuts and dropped an unpopular plan to scrap some benefits for low-earners, as well as announcing a higher growth forecast of 2.4% for 2016.
US economic growth for the third quarter has been revised up, helped by stronger investment and house building. GDP rose at an annual pace of 2.1%, not the 1.5% rate it reported last month. Even with the GDP revision, growth still slowed from an annual pace of 3.9% in the second quarter.
German business confidence unexpectedly rose in a sign that Europe’s largest economy is robust enough to weather risks including a global slowdown and Volkswagen’s emissions scandal. The IFO institute’s business climate index climbed to 109 in November, the highest level since June 2014, from 108.2 in October.
Businesses and individuals looking to buy dollars and sell euros may benefit from a forward contract to hedge against adverse movements. Please contact us for your free, no obligation FX comparison.
Here are the exchange rates taken at 12.14pm 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 1.5045
GBP/EUR 1.4217
USD/EUR 0.9450
Please like and share our Facebook page: www.facebook.com/FXIntroducer
You can also get in touch on Twitter: @fx_introducer