Daily Currency Update

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Losses for Sterling

GBP - British Pound

The pound lost considerable ground against the euro and US dollar yesterday. UK news has been dominated by negative headlines recently with UK gas prices rising to record highs, fuel stations being bombarded with panicked consumers, weakening growth, and rising inflation.

The headlines come at a time when the Bank of England is expected to taper quantitative easing before the end of the year and look at interest rate hikes late next year, but these expectancies may be revised if the ongoing concerns continue.

Sterling fell against the US dollar yesterday, taking the currency pair from around 1.3716 down to 1.3521. A similar move was also seen against the euro, with the fall taking GBP/EUR from around 1.1725 down to 1.1580.

Key Movers

Shaky financial markets have driven demand for the USD. Energy shortages in China, driven by localised COVID-19 lockdowns, have brought about concerns over how it could impact growth, leading to banks downgrading their 2021 growth forecasts. This added downward pressure to stock markets yesterday which had been trading in the red anyway. UK concerns already mentioned and growing cases of the Delta variant globally have also contributed to interest in the safe haven US dollar from investors.

The USD gained against the pound and the Australian dollar. Other safe haven currencies such as the JPY and CHF have also appreciated against a basket of currencies in the past 24 hours.

Expected Ranges

GBP/USD: 1.3460 - 1.3590 ▼

GBP/EUR: 1.1520 - 1.1630 ▼

GBP/AUD: 1.8570 - 1.8690 ▼

GBP/NZD: 1.9380 - 1.9490 ▼

EUR/USD: 1.1630 - 1.1710 ▼