Pound fluctuates on mixed data and bets for a BoE rate hike

  • Pound fluctuates on mixed data and bets for a BoE rate hike

     

    GBP exchange rates fluctuated through the second half of October amid mixed economic data, Brexit tensions, and expectations of an imminent Bank of England (BoE) rate hike.

    GBP/EUR wavered between €1.19 and €1.18, trending sideways overall, while EUR/GBP traded between £0.84 and £0.85.

    GBP/USD dropped from $1.37 to $1.36, after briefly touching $1.38, and EUR/USD ranged from $1.15 to just shy of $1.17, losing ground overall.

     

    Staying on top of the latest currency news can help you time your transfers more effectively, so find out what you should be looking out for over the next couple of weeks…

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    What’s been happening?

    The pound fluctuated as mixed data indicated the UK’s uneven economic recovery, while BoE rate hike bets prevented significant losses.

    The euro was fairly muted as German data continued to disappoint investors. However, expectations that the European Central Bank (ECB) may tighten policy sooner than expected saw the euro spike.

    Meanwhile, the US dollar edged higher, despite a mixed market mood, surging at the end of the month due to a market correction ahead of the Federal Reserve interest rate decision this week.

     

    What do you need to look out for? 

    Traders expect the BoE to hike rates at its meeting this week but many economists disagree. If markets are disappointed, GBP could slip.

    November’s ZEW economic sentiment index for Germany could influence the Euro. No forecasts are out yet, but a sixth consecutive drop could dent EUR.

    The Fed is likely to announce tapering plans at its next rate decision, which could see the US dollar soar.

     

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