With the dollar making a late comeback, GBP/USD found itself giving back some of its gains from earlier in the week. GBP/USD dropped 48 pips to finish at 1.5555, but still closed over 300 pips above its weekly open price.
The pound’s demise had more to do with USD strength thanks to better-than-expected NFP figures as opposed to any news from the U.K. Make sure you hit up my USD commentary for the 411 on the NFP report!
One thing to pay attention to is the U.K. trade balance report, which came in slightly better than anticipated, printing a deficit of just 8.2 billion GBP. This was smaller than the previous month’s 9.2 billion GBP and the projected 8.8 billion GBP. Take note though, that both exports and imports dropped, and the reason why the deficit shrank was due to falling imports, indicating slowing demand.
Nothing lined up till tomorrow, when monthly manufacturing production growth figures hit the markets. Till then, we may see consolidation takeover pound pairs.
Boo yeah! The pound is off to a good start! Despite the lack of reports from the U.K., it scored a 50-pip win against the dollar when GBP/USD closed higher yesterday at 1.5572. Meanwhile, against the yen, it was up at 153.74 from 151.89 by the end of the day’s trading!
It would seem that good ol’ risk appetite picked up and allowed the pound to finish the day in the green. If you’re looking to trade the currency today, you should be on your toes for the manufacturing production report when it’s released later at 8:30 am GMT. It is expected to come in flat but if the actual figure posts positive growth, it may just spark another pound rally!
Cable showed that its gains last week weren’t a fluke as it staged another stellar rally yesterday. The pair began the day at 1.5578, sold-off initially to 1.5522, and then skyrocketed to close the U.S. trading session at 1.5648. All in all, the pair clocked in a very respectable 70-pip victory.
Data from the U.K. were mixed. On the negative side, the Manufacturing Production Report came in worse than expected, printing a 0.2% decline instead of a flat 0.0% reading. On the positive side, the Industrial Production report showed a 0.1% increase, opposite the 0.4% decrease the market had initially predicted.
Today will be a relatively exciting day for Cable as U.K.'s employment report is on deck. It is set to publish at 8:30 am GMT and it is expected to show that joblessness remained at 7.8% in May. In addition, the number of people claiming for unemployment insurance is estimated to fall by 6,800. Cable typically reacts to the jobs report fundamentally–better than expected results lead to rallies while worse than expected results are followed by sell-offs.
Flex them muscles, pound bulls! The pound bulls showed that they are made of pretty strong stuff yesterday as they pushed Cable to its highest level in four months. Cable opened the day at 1.5648 and then closed the day with a respectable gain at 1.5679.
Cable’s gains could be attributed to positive data. Yesterday, U.K.'s jobs report showed that the 3-month moving average of employee earnings rose a whopping 1.3%. The forecast was only for a 0.3% gain. In addition, the number of people claiming for jobless insurance declined 8,600, which was much higher than the estimate of 6,800.
No data on U.K.'s economic docket today so Cable will most likely be driven by events occurring elsewhere. Pay attention to the U.S. retail sales report later at 12:30 pm GMT, as worse-than-expected results could lead to another Cable rally.
Four in a row, baby! The pound hasn’t scored a loss against the dollar this week. Yesterday, GBP/USD once again finished higher at 1.5700 after opening the day at 1.5679. Will we see a sweep?
There were no reports from the U.K. released overnight. However, the much-anticipated U.S. retail sales report was on tap and fortunately for the pound, it seems like the pick-up in consumer spending wasn’t really enough to get investors going loco for the dollar.
Our forex calendar is still blank for reports from the U.K. this Friday. My guess is that we’ll see market sentiment dictate the currency’s price action. With that said, make sure you’re on your toes for any changes in the market’s mood and profit-taking, ayt?
Talk about having a funky Friday! The pound saw heavy selling early on in the day against the dollar. GBP/USD dropped to 1.5616 after opening at 1.5700. But just before the New York session came into play, the pair bounced back up to close with a 7-pip gain at 1.5707.
There weren’t any economic reports released from the U.K. However, what we saw last Friday might have been a wave of profit-taking from dollar shorts which also quickly finished.
Our forex calendar is once again blank for reports for the pound today. With that said, make sure you’re on your toes for any shifts on market sentiment. Keep in mind that the currency tends to do well when risk appetite is up, ayt?
Due to the lack of hard-hitting economic data, Cable was unable to make significant strides in the foreign exchange market yesterday. It simply moved within a horizontal channel, finding support at 1.5680 and resistance at the 1.5750 level. It opened at 1.5707 and closed the day a mere 29 pips higher at 1.5736.
If yesterday was uneventful, today could be the complete opposite as the U.K. is scheduled to release a few important pieces of data.
At 9:30 am GMT, U.K. inflation data will be published. It’s expected to show that the inflation rate climbed to 2.6% in May from 2.4% in April. The core version is also anticipated to rise, to 2.1% from 2.0%.If the inflation rate unexpectedly goes above 3.0%, expect to see a letter from the BOE explaining what is being done to address the high rate. Let’s wait and see how it’ll affect Cable’s price action later.
Tough day for the pound! The sterling posted heavy losses against the dollar and the euro following a surge in demand for EUR/GBP. Cable dropped by 90 pips while EUR/GBP rocketed to its last month’s highs at around .8575. What’s up with that?!
Yesterday the U.K. printed its inflation numbers, which showed that consumer prices had risen at a rate of 0.2% in May and an annualized rate of 2.7%. The numbers trumped expectations of 0.1% monthly and 2.6% annualized growth rates and supported the MPC doves’ concerns that more stimulus could boost consumer prices. Unfortunately for the pound, the markets were paying more attention to the euro. Thanks to positive ZEW reports from the region, the common currency gained ground and dragged the pound lower.
Will the pound get more attention today? At 8:30 am GMT the MPC will release its latest meeting minutes. While the central bank didn’t change anything to its monetary policies, investors will pay close attention to its tone, which could give hints on how aggressive it will be when Mark Carney steps up as the BOE’s head honcho. Then, at 8:00 pm GMT outgoing BOE Governor Mervyn King will be under the spotlight. Keep an eye out for any hints of the central bank’s short-term plans or biases!
Out of the way, pound bears coming through! In just two days, sellers managed to undo six days’ worth of gains on Cable as the pair followed up Tuesday’s drop with a massive 154-pip slide. What in the world happened?!
Well, it surely wasn’t the MPC meeting minutes that caused the wild move on GBP/USD, as the minutes didn’t really reveal anything new. Once again, Paul Fisher, David Miles, and BOE head Mervyn King voted for additional stimulus in the last meeting, while the remaining members stood their ground and deemed it appropriate to leave monetary policy unchanged.
One interesting thing that came up in the meeting was how policymakers predicted that inflation would rise to 3.0% in Q3 2013. Could that be the reason why central bankers have been hesitant to increase stimulus? Perhaps! Though they also mentioned that previous asset purchases and the Funding for Lending Scheme are still working their magic on the economy.
From the looks of it, the big drop was caused solely by the FOMC statement, which favored the dollar immensely. With that in mind, GBP/USD trading will probably continue to be heavily affected by sentiment towards the dollar today, but the UK retail sales report could provide us with day trade opportunities.
At 9:30 am GMT, the U.K. is set to publish its latest consumer spending stats, which is anticipated to show a 0.8% increase following the previous month’s 1.3% decline. If it prints strong results, it could help the pound recover lost ground, so don’t even think of missing this one, fellas!
What a cliffhanger! The pound hung on for dear life in its battle against the dollar, and at the end of the day, it managed to finish practically unchanged. GBP/USD traded as low as 1.5414 before the pound made its comeback to bring price back up to 1.5488, down just 3 pips on the day.
Cable was on its way to post another big loss, but thanks to the retail sales report, it ended near its opening price. Retail sales surged by 2.1% in May, which is more than twice the 0.8% increase that many had anticipated. What’s more is that the 1.3% decline in April was revised up to 1.1%! That’s two months of good news in one release, homies!
Looking ahead, we have public sector net borrowing data coming out at 8:30 am GMT. Survey says we’ll see borrowing climb to 12.7 billion GBP from 8.0 billion GBP. Now, keep in mind that this report doesn’t usually get much attention, but if it prints wildly off expectations, it could generate interest and affect pound price action.
Goodness me! There’s just no stopping the bloodbath, is there? GBP/USD crashed below the 1.5400 major psychological level last week, as it dipped to a low of 1.5377 before closing at 1.5387. Will Cable be able to recover today?
Better than expected public sector net borrowing data wasn’t enough to lift the pound’s spirits on Friday, as the Greenback still remained the king of the hill. The U.K. public deficit landed at 10.5 billion GBP for May, smaller than the estimated 12.7 billion GBP shortfall. On top of that, the April figure was revised down from a deficit of 8.0 billion GBP to just 6.6 billion GBP. Could this be a sign that the U.K.'s finances are starting to improve?
There are no major reports on the U.K.'s schedule for today, which could mean that pound pairs might be in for a quiet trading day. In fact, the pound might actually be in for a quiet trading week as there are no U.K. red flags on deck. The only economic releases to watch out for this week are the BBA mortgage approvals, Nationwide HPI, CBI realized sales, current account, and final GDP reading. Oh, don’t forget to keep tabs on the inflation report hearings tomorrow and the government spending review on Wednesday, as these events could also affect pound movement.
Just like my homeboys from Daft Punk, it looks like the pound got lucky in yesterday’s trading. It scored a handful of pips against the dollar despite the lack of reports, finishing with a win for the first time in five days! GBP/USD was up at 1.5443 after opening at 1.5376. Boo yeah!
Today, there are a couple of events scheduled for the pound. At 8:30 am GMT, the BOE Inflation Report Hearings will commence. Keep an ear out for what BOE officials have to say with regards to rising prices. If they sound optimistic that inflation will soon trickle higher, we could see the pound continue its rally.
Along with that, the BBA mortgage approvals report for May will be on tap. A reading of 33,100 is expected. A better-than-expected reading should be bullish for the pound, so watch out!
Ho-hum. Thanks to a lack of market-moving data, the pound ended the day with mixed performances against its counterparts. GBP/USD and GBP/JPY ended the day almost near their open prices while EUR/GBP slipped by 11 pips.
Yesterday the U.K. printed its BBA mortgage approvals data, which clocked in at its 16-month high. The CBI realized sales also provided good vibes when it showed a reading of 1 as expected, higher than the previous -11 index figure.
Unfortunately, traders also had their attention on other major currencies. For instance, the euro has been getting attention because of rising bond yields in the region. Still, it doesn’t mean that the pound won’t get any action today.
At 9:30 am GMT outgoing BOE Governor Mervyn King is scheduled to give a speech. Keep your eyes peeled for any hints of the BOE’s short-term challenges! Also scheduled at 9:30 am GMT is the BOE’s financial stability report.
Though it doesn’t usually move the pound significantly, it could still affect the currency’s price action on an intraday basis. Ditto for the government spending review scheduled at 11:30 am GMT. In any case, make sure that you watch your pound trades closely as market sentiment could always go either way in this environment!
No thanks to the dovish financial stability report from the Bank of England (BOE), Cable found itself significantly lower yesterday. The pair started the day at 1.5434 and trekked lower throughout the Asian, European, and U.S. trading sessions. By the end of the day, the pair was sitting 119 pips lower at 1.5315.
The BOE stated in the report that the forecast for financial stability is still clouded by the frail and imbalanced recovery not only in Europe, but in the rest of the world too. The BOE also cautioned the markets that abrupt shifts in monetary policy and interest rates could hurt recovery. And finally, the report cited that borrowers still have a high level of debt, which poses a threat to U.K. banks.
U.K.'s economic docket today is pretty light as only a couple of medium tier data are scheduled to be released. At 8:30 am GMT, the country’s current account balance and third estimate of its Q1 2013 GDP report will be published. The current account balance is expected to show an 11.9 billion GBP deficit while no revisions are expected to the 0.3% growth rate.
You win some, you lose some. Although the pound managed to hold steady against the Japanese yen, it resumed its losing streak against the Greenback as GBP/USD dipped dangerously close to the 1.5200 mark. What’s in store for the pound pairs today?
U.K. data came in mostly weaker than expected yesterday, with the current account balance posting a larger deficit of 14.5 billion GBP compared to the estimated 11.9 billion GBP shortfall. Business investment also showed weakness for the first quarter of the year, as the figure was revised down from the initial reading of -0.4% to show a 1.9% decline. Meanwhile, the GDP figure for Q1 2013 was unchanged at 0.3%.
There are no major reports due from the U.K. today but do keep your eyes peeled for the release of the Nationwide HPI report which reflects housing price inflation. A 0.4% uptick in house prices is expected for the month of June.
Talk about ending the week deep in the red! For the third consecutive day, GBP/USD closed lower than its opening price, as it finished at 1.5209, marking a 59-pip loss.
The pound just couldn’t overcome dollar strength, which was buoyed by comments by FOMC members who appear to be on board with tapering asset purchases later this year. Make sure you hit up my USD commentary for more details on what Fed members have been saying!
Looking ahead, we’ve got a couple of reports to watch out for that will be released at 8:30 am GMT.
Ironically, both the manufacturing PMI report and the net lending to individual reports are both expected to print the same readings that they had last month, which were 51.3 and 1.4 billion GBP, respectively. Better than expected scores could give the pound bulls the juice needed to push ahead and recuperate some of last week’s losses.
Somebody’s acting all jumpy! GBP/USD had a volatile trading day as it slipped to a low of 1.5184 then zoomed up to a high of 1.5247 before consolidating around the 1.5220 area. What was that all about?!
The U.K. manufacturing PMI came in better than expected for the month of June, as the figure climbed from 51.5 to 52.5 instead of dipping to 51.3. This shows that the manufacturing industry in the U.K. made a stronger expansion last month, which could contribute positively to overall economic growth.
It’s the construction industry’s turn to release its PMI figure today! The reading is expected to improve from 50.8 to 51.3, also signaling a bigger expansion for the construction industry in June. A stronger than expected reading could give the pound a good boost while a weaker than expected figure could keep its gains at bay. Stay tuned for the actual release at 9:30 am GMT!
The pound might not have been king of pips yesterday, but neither was it at the bottom of the dog pile. GBP/USD’s crash below 1.5200 was met with a 94-pip jump on GBP/JPY and a 22-pip slip on EUR/GBP. What’s up with that?!
Yesterday the U.K. popped up its construction PMI report, which had just missed its 51.3 expectations by coming in at 51.0 The figure was enough to entice a couple of bulls though, as it marked a second consecutive uptick for the data. Not only that, but most of the improvements came from the housing sector, which suggests that the BOE’s funding for lending scheme is actually working.
The last of the PMI trio, the services PMI, will be on tap at 8:30 am GMT. The data is expected to come in slightly lower than its figure last month, so be careful about placing bullish GBP trades. The BOE’s credit conditions survey will also be released at the same time, so y’all better have flexible trading plans when trading the PMI report!
Oh yeah! There’s nothing like strong U.K. data to get the pound fired up. GBP pairs sharply traded higher yesterday following the services PMI report. GBP/USD finished the day 122 pips higher at 1.5276 while GBP/JPY bounced off its intraday low of 151.25 to close the day at 152.55.
It was reported yesterday that the U.K. services sector grew at its fastest pace in two years last June. The index printed at 56.9 versus the modest 54.6 forecast. Boo yeah!
I wonder if the pound will be able to build on its gains today. Later at 11:00 am GMT, the BOE will have its interest rate statement. This will be Mark Carney’s first one as BOE head honcho and the consensus is for him not to announce any changes to monetary policy or asset purchases.
However, market junkies will be keeping an ear out for what he has to say about the bank’s future decisions and about the economy. So make sure you stay tuned! If he sounds hawkish, we could see the pound extend its rally!
Somebody call an ambulance, Cable is bleeding very badly! In a surprising turn of events, Cable took a massive dive yesterday as the BOE rate statement revealed that it was on the cusp of further easing. Cable opened the day at 1.5272 and was sold-off heavily quickly after the release to close the day almost 200 pips lower at 1.5075.
Carney’s very first meeting as the head of the BOE was eventful. Besides the usual rate and QE announcement (no changes for both), the central bank also let loose a pretty detailed statement regarding the state and future direction of monetary policy.
The BOE said that “the implied rise in the expected future path of the Bank Rate was not warranted by the recent developments in the domestic economy,” which was a clear clue that the BOE is looking to print more money as a way to force rates lower.
In other news, the Halifax HPI came in slightly better than expected. It showed that house prices financed by the HBOS rose 0.6% for the month of June instead of only 0.4%. It was also an improvement from May 0.5% rise.
No data on U.K.'s economic cupboard today but it would be silly to say that we won’t see any volatility. The U.S. is scheduled to release its NFP report today, which is likely to have a huge effect on Cable’s price action. It’s going to come out at 12:30 pm GMT, so make sure you’re prepared.