Fears of a looming global recession have acted as a key catalyst of movement in the currency market over the past couple of week, leading to investors favouring safe-haven assets.
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…
Latest currency news
This saw GBP/EUR trade between 1.16 and 1.15, whilst propelling EUR/GBP up to 0.86.
Meanwhile, GBP/USD slumped from 1.22 to as low as 1.20, whilst EUR/USD retreated from 1.05 to 1.04.
What’s been happening?
The second half of June saw the US dollar come close to testing the multi-year highs struck in May, with recession fears and Federal Reserve rate hike expectations stoking demand for the currency.
The euro fluctuated over the past couple of weeks, firming on hawkish European Central Bank (ECB) comments but facing headwinds as a result of concerns over European energy security.
Meanwhile the pound trended broadly lower, buffeted by Brexit uncertainty, economic concerns and a dovish Bank of England (BoE).
What do you need to look out for?
Looking ahead, the first half of July may see the currency market continue to be driven by recession concerns, likely buoying demand for the safe-haven US dollar.
An impending interest rate hike from the ECB could help to underpin the euro, especially if the bank’s forward guidance points to a 50bps hike in September.
Meanwhile, the pound may face an uphill battle as domestic political uncertainty and concerns over the UK’s economic trajectory continue to act as a headwind for the currency.
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