The pound initially opened last week’s session on stable footing as GBP investors welcomed Scotland’s lifting of its remaining coronavirus restrictions.
Sterling remains largely range bound this morning, with GBP/EUR flat at €1.1107, GBP/USD stable at $1.2677 and GBP/CAD trading at C$1.7206. GBP/AUD is static at AU$1.7932 while GBP/NZD holds NZ$1.8808.
We don’t expect to see a great deal of movement today as markets wind down ahead of the Christmas break.
What’s been happening?
The pound drifted higher at the end of last week as markets reacted to the UK’s last data drop of 2018.
This included the release of the UK’s final GDP reading for the third quarter, which saw the Office for National Statistics (ONS) confirm that the UK economy expanded by 0.6%, its fastest pace since the end of 2016.
However Sterling was kept in check by the accompanying business investment figures, as investment in the UK contracted at its fastest pace since Q1 2016.
The data was enough to allow GBP/EUR to accelerate through Friday’s session however, with the euro sliding after French GDP was revised down in the third quarter and Eurozone consumer confidence struck a 22-month low in December.
Meanwhile, the GBP/USD exchange rate was left on the back foot at the end of last week’s session, with the US dollar appearing to shrug off fears of a US government shutdown as the latest PCE Price Index revealed that inflation was more robust than initially forecast in November.
What’s coming up?
With no economic data of note and with investors preparing to feast on turkey over the Christmas break, it’s unlikely the currency market will see much in the way of movement today, a trend that may continue through to the end of 2018 due to thin trading volumes over the holiday period.
Joining the corporate trading desk in 2007, Phil now over sees all of Currencies Direct’s corporate dealing activity. Having gained experience working with hundreds of businesses to optimise international payments processes and execute comprehensive risk management strategies, Phil currently works with a portfolio of corporate clients whilst managing Currencies Direct’s overall market exposure
Phil has FCA approval and has completed the Certificate in International Treasury Management (CertiTM)