04/12/2023 – Exchange Rates

  • Posted by currencies in Rate Alerts
  • December 5, 2023
  • No Comments

The last few weeks have been very supportive for Sterling- mainly due to the weakness in the Dollar and the risk on sentiment in the market currently- The FTSE has been on the rise, along with the S&P500 and NASDAQ. Usually, when the stock markets are more risk on, we see Sterling gain as well- and this time has been no different. Sterling was also helped by positive UK housing data on Friday which showed growth in prices through November which gave the Pound a positive lift to end the week at 1.1670 against the Euro and 1.27 against the Dollar.

This week I would say is the last real week of data and volatility on the market, we usually expect a “Santy Rally” on markets in this period which should be good if you are looking to purchase Euros and Dollars- it is still too early to look at Q1 predictions for 2024 at this point so we will revisit that later this month.

Monday is a relatively quiet day on the data front with US factory orders from October coming out where we are expecting to see a negative number, later we have speeches from ECB’S Lagarde and BoE’s Dhingra- none of which I see being market-moving events.

On Tueday we have the RBA interest rate decision where the market sees zero chance of any move on rates, we also have UK services and composite PMi’s later in the morning which are expected stronger than the previous which should be positive for the Pound if we see it come out this way. At the same time we have the same data for the Eurozone which are also expected in positive- We also have US job openings and ISM services PMI later in the afternoon.

On Wednesday we have Eurozone retail sales which are expected in stronger than previous, followed by US ADP employment data expected to show 120k jobs added last month- which usually gives us a good indicator into NFP’s on Friday (ADP usually does the opposite).

On Thursday we have the Bank of Canada interest rate decision, again no change expected- this is also followed by US Jobless claims.

On Friday the main event is U.S Non Farm Payrolls data where the expectation is 180k jobs added, with unemployment staying at 3.9%- it will be interesting to see how this plays out as NFP’s never come out as expected.

GBP/EUR 1.1618 GBP/USD 1.2616 GBP/AED 4.6020
GBP/AUD 1.9054 GBP/CHF 1.1064 GBP/CAD 1.7193
GBP/NZD 2.0536  EUR/USD 1.0940 GBP/ZAR 22.957

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