Monday, 12 December 2016

Central Banks could move exhcange rates this week

Pound/Euro rates remain supported around the €1.19 mark, but what could affect exchange rates this week? Below I've listed the main economic data releases this week that could affect exchange rates, and there are various central bank announcements that could move exchange rates. Other things can also affect rates that are impossible to foresee, such as political events, Brexit news, natural disasters etc. If you would like a detailed outlook on which currency pair you are looking at, send us a free enquiry today by clicking here.

This week's economic data releases


Monday 12th December 2016 - Today has been quiet on the data front with nothing much of note other than UK House prices. Later today we have a US Budget statement that could move GBP/USD rates.

Tuesday 13th December 2016 - Today we see a raft of inflationary measures from the UK. These are important as they can influence interest rate movements. High numbers increase the chance of a rate hike, and would usually strengthen a currency We also have employment numbers from the EU today, and Trade Balance numbers from the USA.

Wednesday 14th December 2016 - All eyes will be on the USA this evening, when they are expected to raise interest rates. The market has already priced this in, however if they leave rates on hold, expect the USD to weaken, and the EUR to strengthen. Employment numbers are also released from the UK today. I expect the rate to remain just under 5%. If it's better than expected the Pound may rise further, however if unemployment has increased, then it's likely Sterling would fall. We also have US Retail Sales numbers today, and EU industrial Production figures.

Thursday 15th December 2016 - Today is the turn of the Bank of England to announce if they will change interest rates. I think they will be left at 0.25%. After the announcement, the Governor Mark Carney will give a press conference, and this is what could move the Pound. Depending how his comments are viewed, they could push the Pound higher or lower. In my view this is the event most likely to move the Pound this week. Carney will probably be negative about the economy so there's the chance of exchange rates falling away.

Friday 16th December 2016 - We end the week with EU Trade balance and inflation numbers. These could well drive future interest rate movements for the EU and could therefore affect GBP/EUR rates.

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