RP: Dollar firms as market gets ready for USA rate decision
Nevertheless, this more pessimistic view did not prevent the GBP/NZD conversion rate from substantially declining to 2.4109. The estimate was 2.5%.
Although United Kingdom jobs data came in better than expected, providing the GBP/USD pair with immediate support, longer-term developments are capped by trader’s cautiousness ahead of the Fed decision.
An increase in interest rates would boost the greenback by making it more attractive to yield-seeking investors.
Meanwhile, the GBP-USD pairing extended its advance until it was up nearly 1% on the day’s opening levels.
It was another disappointment for the Pound (GBP) yesterday as the UK Consumer Price Index printed at 0%, showing that inflation has not grown on the year.
Pound to Australian Dollar, US Dollar, Canadian Dollar Exchange Rates Higher Today after Employment DataThe Pound Sterling (currency: GBP) has enjoyed a strong trading session so far today, with the GBP Euro exchange rate breaking higher to 1.3763 and the Pound Dollar exchange rate jumping to an intraday peak of 1.5453 GBP USD.
The Pound Sterling to Euro (GBP/EUR) exchange rate dropped to a low of 1.3578 during Wednesday’s European session.
The Euro to US Dollar (EUR/USD) conversion rate was trending in the range of 1.1294 to 1.1302 during the European session.
Movements in the foreign exchange market are being led by technical considerations as investors position themselves ahead of the rate announcement, said Vassili Serebriakov of BNP Paribas.
With U.K Retail Sales projected to increase another 0.1% in August, signs of a stronger recovery may heighten the appeal of the sterling as a growing number of central bank officials adopt a hawkish outlook for monetary policy. This will only add to the speculation surrounding whether or not the European Central Bank (ECB) will expand its quantitative easing programme in the near future to shore up the Eurozone’s recovery. There were more signs of easing inflationary pressure Wednesday, as Eurostat reported slowing growth in labour costs across the bloc.
Will Unemployment Decline Prompt Rate Hike?
The United Kingdom unit’s progress has been held back during recent months thanks to economists” concerns regarding a persistent “productivity problem’ in the domestic economy which was impacting on the level of wage growth for Britain’s workforce. Thursday will see significant market volatility with the Federal Reserve interest rate decision dominating trader focus. Sterling rose more than half a percentage point against the Dollar to 1.54, and by the same against the Euro to 1.37 as the news supports those at the Bank of England who are signalling rates will need to rise ‘sooner rather than later’.
