Daily Currency Update

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Bank of England day arrives

GBP - British Pound

Here we are – Thursday has arrived and with it Bank of England day. This will be the focus for investors today and follows the pounds rather mixed performance yesterday against its two largest peers, the US dollar and euro. Against the dollar sterling was tepid losing some of the gains it had made earlier in the week. Against the euro things were a little choppier but at least the pound held its ground. Looking towards midday’s Bank of England meeting the central bank isn’t expected to change its benchmark interest rate or alter its asset purchased programme today but rising inflation levels recently and some hawkish comments could see a change in rhetoric from the bank. If we do see any change in the forward guidance or any members dissenting and voting for a rate hike then the pound could benefit.

Key Movers

Speaking of hawkish comments central bankers look no further than Fed member Clarida who spoke yesterday. Clarida stated that conditions for increasing interest rates in the States could be reached by the end of next year. This saw the US dollar make gains against both the euro and pound yesterday as it was well bid. The USD spot index also picked up nicely 0.5%. The dollar was also supported yesterday by the ISM Non-Manufacturing reading, which unlike its manufacturing counterpart smashed expectations.

Expected Ranges

GBP/USD: 1.3880 - 1.3960 ▼

GBP/EUR: 1.1720 - 1.1760 ▲

GBP/AUD: 1.8780 - 1.8860 ▼

EUR/USD: 1.1830 - 1.1885 ▼