Monday, 23 January 2017

This weeks data releases and events that could affect Sterling exchange rates

Good morning. It's been an interesting start to the year for Pound/Euro exchange rates. As you can see from the chart below as the year got underway, the Pound came under pressure due to ongoing 'Brexit' uncertainty. However, once Theresa May outlined her 12 point plan, it removed much of this uncertainty and Sterling recovered some of its losses. It's also worth nothing that economic data continues to impress and if were not for the uncertainty created due to the UK's decision to leave the EU, the Pound would be soaring much higher than it is.


What could move exchange rates this week?


Usually it's economic data that drives exchange rates, however in recent months, this has been brushed aside as politics takes centre stage and drives the value of Sterling. As I touched on above, the UK economy is performing very well indeed. Below I've listed this weeks events that I think will move the currency markets.

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This week's data:


Monday 23rd January 2017 - Today is fairly quiet on the data front, however this evening the ECB president Mario Draghi gives a speech, and his comments often affect GBP/EUR rates, so we may see movement for Pound/Euro overnight.

Tuesday 24th January 2017 - When markets open they will react to last nights ECB speech. Also on the agenda today is inflation numbers from Euros, UK Public Sector net borrowing figures, and the Supreme Court ruling on whether the government can trigger article 50 without parliament's approval. All of the above may have an impact on GBP/EUR rates.

Wednesday 25th January 2017 - Today we will see Inflation numbers from Australia that could move GBP/AUD rates. Over in New Zealand we also have inflation numbers and a speech by the governor of New Zealand's central bank, so these could move GBP/NZD. Elsewhere, business climate data from Germany may well affect the Euro.

Thursday 26th January 2017 - Preliminary UK GDP numbers are released at 09:30am this morning. I expect this to show monthly growth of 0.5%. A figure higher than this should strengthen the Pound, while a lower reading would bring it lower. It's a busy day across the pond today also, with US Jobless claims, Home Sales and PMI figures all having the potential to move GBP/USD.

Friday 27th January 2017 - All data today is from the USA, with GDO figures and Durable goods orders. Today, Trump and May have their first meeting since the President took office, and this could provide information on a possible US/UK trade deal, and there may be announcements following the meeting that affects Pound/Euro and Pound/Dollar.

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