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Exchange Rate Forecast – Pound Drops to 1.39s – UK Budget Build Up ( Andrew Bromley )
GBP-EUR
The Pound hit a short term low today of 1.3956 as the Euro kicked back following a positive response to Quantitative Easing. It has been confirmed that €9.751 Billion was successfully invested in week one, showing the markets how much faith the Eurozone Central Bank have in its collective economies. With the UK Budget announced on Wednesday, I’d expect a very rocky build up followed by a short period of Sterling strength. I personally believe that this is George Osborne’s best chance to assist David Cameron in convincing undecided voters to choose Tory. As the Tories are the party most likely to grow the economy, the Pound should prosper. However, markets will be over-analysing every aspect of the Budget, so there is no guarantee to stability. Some Market Analysts are predicting major Sterling weakness from Wednesday, as realistically it is the first big move for any party. Watch this space is an understatement – make sure that your position in the market is secure!
USD Forecast
Those that have not sold Dollars just yet could be in for a rocky road this week, as there are several key events to be wary of. Following todays poor US manufacturing figures, the next milestone is housing figures at 12:30 tomorrow afternoon. Every piece of US Data is massively scrutinised at the moment, with the aim of second guessing the next US Interest Rate hike. Predictions are for Q2 / Q3, so we are nearing the event swiftly. The Federal Open Market Meeting (FOMC) Minutes are released late Wednesday evening (following the UK Budget), so clues may be contained then as to when…
I personally have predicted GBP USD slipping to the 1.45 mark and below. The current 20 month low is 1.4750 so with either positive FOMC minutes or an unpopular Budget, this is a real possibility. That being said, rates are at incredibly favourable levels currently. Only you can decide if the risk of GBP strength is worth the reward of yet further improvements in the rate…
If you have an exchange requirement, feel free to drop me an email to [email protected] – I am more than happy to run through your requirement with you. Alternatively, call the direct line to the trading floor – 01494 787 478
Andrew Bromley
Source: http://www.poundsterlingforecast.com/2015/03/16/exchange-rate-forecast-pound-drops-to-1-39s-uk-budget-build-up-andrew-bromley/
