Daily Currency Update

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Sterling drifts lower following latest poll

GBP - British Pound

GBP slipped lower yesterday after a poll was released showing a tightening in the gap between Labour and the Conservatives. A further couple of polls released this morning have shown similar trends, putting the pound under further pressure in early Europe; a poll by Kantar puts the Tories on 43% (-2) and Labour on 32% (+5).

Markets are now awaiting the release of the YouGov Multilevel Regression and Post Stratification Poll (MRP) at 10pm today. The poll uses a recently developed technique that aims to give a more detailed prediction than a standard opinion poll – it was the most accurate forecaster in 2017 polls. So it could move sterling crosses overnight/tomorrow morning, with it also combining with thin market trading conditions due to Thanks Giving in the US tomorrow.

Key Movers

Mid tier data from the US came in worse than expected as CB Consumer Confidence and the Richmond Manufacturing Index both missed target yesterday.

Today sees the second estimate of US GDP which is expected to hold at 1.9%. Markets will be eyeing it closely as any miss may influence policy makers at the Fed to ease further.

USD/JPY pushed up through 109 and commodity currencies enjoyed a small bounce as China's Ministry of Commerce again hinted at progress being made in phase 1 of any trade agreement between the US and China. Reuters also quoted Donald Trump as saying they are in the “final throes” of a trade deal.

AUD fell vs. all major currencies overnight after Westpac bank predicted that the RBA will cut interest rates twice by June next year before starting quantitative easing.

Expected Ranges

GBP/USD: 1.2820 - 1.2900 ▼

GBP/EUR: 1.1600 - 1.1690 ▼

GBP/AUD: 1.8900 - 1.9020 ▲

GBP/NZD: 1.9950 - 2.0050 ▲