GBPUSD news - page 20
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Halifax U.K. HPI rises 0.6% in September
House prices in the U.K. rose more than expected in September, easing concerns over the health of the housing market, industry data showed on Wednesday.
In a report, the Halifax Bank of Scotland said its House Price Index rose by a seasonally adjusted 0.6% last month, above expectations for a 0.2% increase.
U.K. house prices were flat in August, downwardly revised from a previously reported increase of 0.1%.
House prices in the three months to September were 9.6% higher than in the same three months a year earlier, in line with forecasts and slowing from a gain of 9.7% in August.
GBP/USD rises to 1-week highs, BoE statement on tap
The pound rose to one-week highs against the U.S. dollar on Thursday, as demand for the greenback weakened after the minutes of the Federal Reserve's latest policy meeting, while investors awaited the Bank of England's policy statement due later in the day.
GBP/USD hit 1.6216 during European morning trade, the pair's highest since October 2; the pair subsequently consolidated at 1.6207, rising 0.25%.
Cable was likely to find support at 1.6029, Wednesday's low and resistance at 1.6251, the high of October 2.
The dollar wekened broadly after the minutes of the Fed's September 16-17 policy meeting released on Wednesday showed that a number of officials believe the bank's current language painted the wrong picture on the timing of rate hikes and that an interest rate rise should be tied to U.S. economic progress.
The report also showed that the U.S. central bank cut its growth outlook due to the higher dollar and concerns over global weakness.
In the U.K., the BoE was set to announce its benchmark interest rate, which was expected to remain unchanged as well as the level of the bank's asset purchase facility program.
Sterling was lower against the euro, with EUR/GBP edging up 0.11% to 0.7885.
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GBP/USD remains near 1-week highs as BoE holds
The pound remained near one-week highs against the U.S. dollar on Thursday, after the Bank of England left its monetary policy unchanged and as the minutes of the Federal Reserve's most recent policy meeting continued to weigh on the greenback.
GBP/USD hit 1.6220 during European early afternoon trade, the pair's highest since October 2; the pair subsequently consolidated at 1.6211, adding 0.28%.
Cable was likely to find support 1.6029, Wednesday's low and resistance at 1.6288, the high of September 30.
In a widely expected move, the BoE voted to keep interest rates on hold at 0.5% and to keep the size of its asset purchase program unchanged at £375 billion.
The minutes of the meeting, due to be published in two weeks, would indicate how many monetary policy committee members voted in favor of a rate hike. The MPC was split in September for the second consecutive month, with two members voting in favor of a rate increase and two against.
Meanwhile, the dollar remained under pressure after the minutes of the Fed's September 16-17 policy on Wednesday showed that a number of officials believe the bank's current language painted the wrong picture on the timing of rate hikes and that an interest rate rise should be tied to U.S. economic progress.
The minutes also showed that the U.S. central bank cut its growth outlook due to the higher dollar and concerns over global weakness.
Elsewhere, sterling was steady against the euro, with EUR/GBP dipping 0.04% to 0.7873.
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BoE Keeps Rates On Hold
The Bank of England maintained its key policy rate at its historic low once again as policymakers await more concrete signs to suggest that the economic recovery is becoming sustainable amid slowing inflation.
The nine-member Monetary Policy Committee decided on Thursday to retain its key rate at a record low 0.50 percent and the asset purchase programme at GBP 375 billion.
At the September meeting, only Ian McCafferty and Martin Weale sought a quarter point hike as seen in August. They observed that even after a 25 basis-point hike, monetary policy remains extremely supportive.
But other members assessed that evidence is insufficient to justify an immediate increase in interest rate. More members are likely to join the two hawks only by early 2015.
Governor Mark Carney suggested last month that the time for raising rates is getting closer and the timing of such an action will depend on the data.
The National Institute of Economic and Social Research said Tuesday it expects the first rate hike to come in February 2015.
IHS Global Insight's Chief UK Economist Howard Archer said he expects a rate hike to 0.75 percent in February but there looks to be a very real possibility that it could delay acting until nearer mid-year.
The International Monetary Fund warned on Tuesday that the United Kingdom faces financial stability risks arising from housing and mortgage markets. Housing supply-side measures are crucial to safeguard housing affordability and mitigate financial stability risks.
Earlier this month, the BoE sought more powers to regulate mortgage lending in order to protect property market from overheating and avert risks to financial stability.
In a letter to Chancellor, Carney said the Help to Buy scheme does not pose material risks to financial stability.
Mortgage approvals fell to a 3-month low of 64,212 in August from 66,100 in July. According to Credit Conditions survey, British banks expect demand for secured lending for house purchase to increase in the fourth quarter after falling in the third quarter.
Meanwhile, the IMF maintained its estimates for the U.K. even as it downgraded its growth projections for the global economy. The lender estimated 3.2 percent economic growth for the U.K. this year and 2.7 percent the next year.
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U.K. trade balance -9.10B vs. -9.60B forecast
The U.K.’s trade balance rose more-than-expected last month, official data showed on Friday.
In a report, National Statistics said that U.K. trade balance rose to a seasonally adjusted -9.10B, from -10.41B in the preceding month whose figure was revised down from -10.19B.
Analysts had expected U.K. trade balance to rise to -9.60B last month.
U.K. Visible Trade Gap Narrows In August
The U.K. visible trade deficit narrowed more-than-expected in August despite exports falling to a near 4-year low, figures from the Office for National Statistics showed Friday.
The visible trade deficit decreased to GBP 9.1 billion in August from GBP 10.4 billion in July.
This was the first time in the past five months that the goods trade deficit has narrowed. Still the actual deficit was below than the expected shortfall of GBP 9.6 billion.
Exports decreased GBP 0.7 billion to GBP 23.2 billion, the lowest since September 2010. The fall in exports reflect lower shipment of oil and chemicals. At the same time, imports dropped GBP 2 billion, which was the biggest monthly fall since July 2006.
The trade deficit with EU nations narrowed to GBP 5.5 billion from GBP 5.7 billion. Similarly, the shortfall with non-EU nations decreased to GBP 3.6 billion from GBP 4.8 billion in July, less than the GBP 4 billion deficit expected by economists.
In the three months to August, the trade in goods deficit widened by GBP 2.7 billion to GBP 29.2 billion, data showed. Within the EU, Germany remains the largest trading partner for the U.K.
Trade in services registered a surplus of GBP 7.2 billion in August after posting GBP 7.3 billion surplus in July. Consequently, the total trade deficit declined to GBP 1.9 billion in August from GBP 3.1 billion in July.
U.K. economic growth is currently dependent on robust domestic demand; and the underlying August trade data will do little to dilute the view that this will remain the case in the near term at least, IHS Global Insight's Chief U.K. Economist Howard Archer said.
Another report from the ONS today showed that construction output declined 3.9 percent in August from July. The output for July was revised to 1.9 percent from an original estimate of no change.
On a yearly basis, construction output slid 0.3 percent in August, which was the first fall since May 2013.
The monthly fall in construction output in August suggests that the economic recovery became very dependent on the dominant services sector in the third quarter, Paul Hollingsworth, a UK economist at Capital Economics, said.
Nonetheless, the economist said he remains confident that domestic demand should be strong enough to ensure that it maintains a healthy degree of momentum over the next couple of years.
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GBP/USD forecast for the week of October 13
The GBP/USD pair initially rallied during the course of the week, but found the 1.62 level to be resistive enough to turn things back around and form a shooting star. The shooting star of course suggests that there is still bearish pressure in this marketplace, and on a break of the bottom of the shooting star we would be sellers. With no interest in buying this market at the moment, as the US dollar in general is far too strong due to interest rates and economic expectations going forward.
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GBP/USD Forecast Oct. 13-17
The British pound changed directions last week gaining about 100 points. GBP/USD closed the week at 1.6065. This week’s key events are CPI, Average Earnings Index and Claimant Count Change. Here is an outlook on the major events moving the pound and an updated technical analysis for GBP/USD.
British releases were uneventful last week, and the BoE held steady with its monetary policy. In the US, the dollar softened after unexpectedly dovish FOMC minutes, where the central bank expressed concern about the recent strength of the dollar against its major rivals.
* All times are GMT
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British Manufacturers Expect Growth To Ease In Q4
British manufacturers expect growth to slow in the final quarter of 2014, reports said citing a survey from accountancy group BDO on Monday.
The index measuring businesses' growth expectations declined to 111.6 from 113.2 in August. However, a reading above 100 indicates growth forecast rather than contraction.
With global conditions becoming increasingly challenging, it was only a matter of time before the stellar increases in economic growth recorded earlier this year came to an end, Peter Hemington, a partner at BDO, said.
At the same time, the general index dropped to 103.3 in September from 103.8 in August.
However, the indicator that measure recruitment expectations rose to 112.3 from 111.2 in August.
BoE's Carney Says Slowdown In Eurozone Not To Dictate Monetary Policy
The slowdown in the euro area does not dictate the monetary policy of the Bank of England, Governor Mark Carney said in an interview with the U.S. news channel CNN.
"The only difficulty that is caused by Europe is that it provides an additional drag on growth," he said. "But that doesn't dictate the monetary policy of the Bank of England."
Carney said the U.K. recovery has been driven primarily by domestic factors. The bank will monitor domestic inflationary pressure and not just what is happening internationally, he added.
Carney said the weakness in the euro area had been a major topic at the International Monetary Fund meetings in Washington.