It’s been a volatile week for the currency markets, especially for USD-pairs. With a combination of economic data and geopolitical risks have shifted the USD against EUR and GBP into red throughout the week. While writing both the EUR and GBP are within close reach of a 4-year high to the dollar.
Ahead of today’s market session, it’s US data that will be on the radar with personal consumption expenditure, personal income and personal spending getting released at 1.30pm. Personal consumption expenditure is forecasted to stay flat from its previous month – this would suggest that prices on specific goods in the US are unchanged and not causing inflation pressure on the consumer. At the same time, we also have personal income and spending. Forecasts of retraction of both, with income projected to have the larger fall month-on-month, seeing a decrease from 0.8% to 0.3%. This would come hand in hand for spending possibilities, if income is reduced – household will hold off spending, which we can see is predicted to fall from 0.2% to 0.1%.
Ahead of next week we start the week off with UK and European data in the first couple of days. For the UK we will see both mortgage approval and housing prices. While for Europe, the do release core inflation and inflation levels. With EUR and GBP already in very healthy regions to the USD, releases that don’t show a set-back can continue the run and momentum. The USD can face further actions in the end of next week when non-farm payroll is being presented. Now, it’s forecasted to produce less jobs than in its previous month – which can signal further pressure and difficulties for the US job-market.
GBP/EUR 1.1719 GBP/USD 1.3735 GBP/AED 5.0468
GBP/AUD 2.0965 GBP/CHF 1.0961 GBP/CAD 1.8738
GBP/NZD 2.2621 EUR/USD 1.1703 GBP/ZAR 24.5550