GBPUSD news - page 53
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Nasty, 100-pip whipsaw in cable
Sterling rips to 1.5360GBP/USD slumped to a session low of 1.5260 in a mystery move but it's been an equally-mysterious rebound in a straight-shot to 1.5360. The day's high is 1.5374.
There is no news behind the move and there's some chatter about thin liquidity but we're at the most-liquid time of the day. It's been a tough market for the past few days.
It's too early to write-off the US dollar but there is nothing impressive about how it's traded since non-farm payrolls.
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GBP/USD: Sterling Trades Firmly Higher Ahead of UK Data
UK traders will not only focus on Chancellor George Osborne's Mansion House speech, but also on April manufacturing and industrial production data. The latter causes some concern as PMI data earlier this month saw a sharp fall.
Markets expect both the manufacturing and industrial production to fall from the positive March readings of 0.5% and 0.4%, respectively, to a fairly meagre 0.1% for both measures for the beginning of Q2.
The cable currency pair rose a firm 0.22% to $1.5420 ahead of the opening bell.
As for the chancellor's speech, Osborne might change his overall tone with respect to the banking sector. HSBC announced yesterday it will lay off 8,000 UK employees.
"This is whywe could see a more temperate tone from the Chancelloras minds get concentrated about the consequences of a move in HSBC’s domicile away from the UK," Michael Hewson from CMC Markets UK wrote in a research note on Wednesday.
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April 2015 UK industrial production 0.4% vs 0.1% exp m/m
UK industrial production and manufacturing output data report 10 June 2015
Oil production drives industrial output higher but a fall in pharmaceuticals pushed manufacturing down
It's a bit of a mixed bag but the fall on the manufacturing side could be a worry that domestic demand has slipped somewhat. There's some half decent revisions as well.
GBPUSD had a little wobble lower but is back at 1.5437
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Pound slides lower against stronger dollar
The pound slid lower against the U.S. dollar on Thursday, pulling away from Wednesday's two-and-a-half week peaks as the greenback recovered from the previous session's losses ahead of the release of U.S. data later in the day.
GBP/USD hit 1.5430 during European morning trade, the session low; the pair subsequently consolidated at 1.5457, declining 0.47%.
Cable was likely to find support at 1.5255, the low of June 9 and resistance at 1.5554, Wednesday's high.
The dollar regained some strength after weakening broadly on Wednesday as investors looked ahead to U.S. retail sales and jobless claims data due later in the day for further indications on the strength of the economy.
The pound had strengthened on Wednesday after the U.K. Office for National Statistics reported that industrial output rose by 0.4% in April, ahead of forecasts for a 0.1% increase, following an upwardly revised increase of 0.6% in March.
However, the report also showed that U.K. manufacturing production fell 0.4% in April, reversing the previous month’s gains.
Sterling was higher against the euro, with EUR/GBP slipping 0.16% to 0.7281.
Sentiment on the single currency remained fragile as uncertainty over Greece continued, although hopes for an agreement on a cash-for-reforms deal lent some support.
Greece’s bailout agreement with the European Union and the International Monetary Fund is set to expire at the end of this month and it cannot make further debt repayments without a new deal.
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Pound slips lower against broadly stronger dollar
The pound slipped lower against the U.S. dollar on Friday, as demand for the greenback remained supported by the previous session's upbeat U.S. retail sales report and ahead of an additional report on U.S. consumer sentiment due later in the day.
GBP/USD hit 1.5492 during European morning trade, the session low; the pair subsequently consolidated at 1.5502, edging down 0.10%.
Cable was likely to find support at 1.5365, the low of June 10 and resistance at 1.5591, the high of May 20.
The dollar found support after the U.S. Commerce Department reported on Thursday that retail sales increased by 1.2% last month, beating expectations for a gain of 1.1%, and that core retail sales, which exclude automobile sales, rose by 1.0% in May, compared to forecasts for a 0.7% increase.
At the same time, the U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending June 6 increased unexpectedly by 2,000 to 279,000.
Investors were looking ahead to a preliminary report on U.S. consumer sentiment due later in the day, for further indications on the strength of the economy.
Sterling was higher against the euro, with EUR/GBP down 0.24% at 0.7234.
The euro remained under pressure since the International Monetary Fund pulled out of Greek debt talks on Thursday after it accused Athens of failing to compromise over labour market and pension reforms.
The IMF said its team of negotiators had quit talks in Brussels after reaching a stalemate and would be returning to Washington.
Greek Prime Minister Alexis Tsipras was scheduled to resume talks in Brussels with European commission President Jean-Claude Juncker on Friday. However, such a meeting is now in doubt.
A government spokesman said Greece's negotiating team is "ready" to intensify efforts to wrap up a deal "even in the next 24 hours."
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UK risks losing last AAA rating as S&P eyes EU exit vote
The only major ratings agency still to give Britain a top-notch credit rating said on Friday it risked a downgrade due to Prime Minister David Cameron's decision to hold a referendum on whether to leave the European Union.
Standard & Poor's lowered the outlook for Britain's triple-A rating to negative from stable on Friday, saying the EU vote "represents a risk to growth prospects for the UK's financial services and export sectors, as well as the wider economy".
Widespread dissatisfaction with the EU within Cameron's Conservative Party, and among many voters, prompted him in 2013 to promise to re-negotiate Britain's membership of the bloc and hold a referendum on the revised terms by the end of 2017.
But the referendum was in question until the Conservatives unexpectedly won a clear majority in last month's election, as other major parties had opposed it.
Opinion polls suggest around a third of Britons want to leave the 28-member bloc, which Britain joined in 1973.
Sterling weakened by around a third of a cent against the dollar after the news.
Britain's finance ministry said "resolving the uncertainty around Britain's relationship with the EU" via a referendum was central to its economic plans.
S&P said that if Britain looked likely to leave the EU, it could cut Britain's rating by more than one notch, and said sterling risked losing its status as a global reserve currency.
As well as hurting Britain's economy, leaving the EU would damage Britain's ability to finance its large stock of public debt and its current account deficit, S&P said. The latter ballooned to a record 5.5 percent of gross domestic product in 2014, largely due to low returns on Britain's investments elsewhere in the EU.
"The U.K. government's decision to hold a referendum on EU membership by 2017 indicates that economic policy-making could be at risk of being more exposed to party politics than we had previously anticipated," S&P added.
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GBP/USD forecast for the week of June 15, 2015
The GBP/USD pair broke out to the upside during the course of the week, slicing through the 1.55 handle. In the process, and broke the top of the shooting star for the previous week, so it does suggest a perhaps the British pound is going to continue to elevate. It doesn’t mean that is going to be an easy move, but we do think that the 1.58 level will be targeted given enough time. Pullbacks at this point should represent value that we can take advantage of, and we do believe that eventually we will break above the aforementioned 1.58 handle. When we do, we think that this market heads all the way to the 1.70 handle given enough time.
We are bullish of the British pound in general, and believe that it will continue to outperform most currencies in the world. We like the fact that the British pound is doing so well against the US dollar, because it shows relative strength in general. If it does well here, if you do well against most currencies as seen on several charts.
Is not until we broke well below the 1.52 level that we would consider selling, and quite frankly we would probably even have to clear the 1.50 level to the downside in order to feel comfortable doing so. With that being the case, we are very bullish of this market and think that’s most of the consensus around the world by currency traders anyway. It is only a matter of time before we break out above the 1.58 level, so we are comfortable buying and holding positions anywhere in this general vicinity. We also recognize that the Monetary Policy Committee has a couple of major announcements this coming week, and that of course could add to the volatility. Ultimately, the market seems to be coming to terms with the fact that the Federal Reserve is only going to do one interest-rate hike this year, and as a result most currencies have been oversold against the US dollar, with the British pound being one of the biggest ones.
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GBP/USD Forecast June 15-19
GBP/USD had a spectacular week, gaining close to 300 points. The pair closed at 1.5541. There are 12 events this week. Here is an outlook on the major events moving the pound and an updated technical analysis for GBP/USD.
In the US, employment and consumer sentiment numbers were upbeat, but the greenback was hammered by the pound as traders were hesitant to buy the USD ahead of the Fed Statement. Even a decline in UK Manufacturing Production didn’t cause any rain on the pound’s party.
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UK House Prices Jump 3.0% In June - Rightmove
The average asking price for a house in the United Kingdom jumped 3.0 percent on month in June, property tracking website Rightmove said on Monday - coming in at 294,351 pounds.
Analysts figure the jump was the result of last month's election results, which resulted in a Conservative victory - as well as a dwindling pool of available houses.
Prices had slipped 0.1percent in May.
On a yearly basis, prices spiked 4.5 percent after gaining 2.5 percent in the previous month.
BP/USD: Sterling Trades Back Above $1.56 Ahead of UK CPI -
Trader attention turns to the UK economy on Tuesday morning with the latest batch of CPI inflation numbers for May. Sterling was slightly higher ahead of the release, awaiting the numbers to guide its direction.
UK CPI declined an inch in April to -0.1% on an annual basis, but is expected to bounce back to 0.0% in May. Core CPI is expected to move back to 1%, up from 0.8%, with the rebound in prices expected to be driven by an increase in air fares, and fuel prices, offsetting low food prices that are still expected to be a drag.
"A number above expectations has the capacity to push the pound, up closer towards the highs seen last month at $1.5800," Michael Hewson from CMC Markets wrote in a research note on Tuesday.
Sterling moved back above the $1.56 handle ahead of the opening bell in Europe on Tuesday, up 0.08% to $1.5611. One month ago, GBP/USD spiked to above $1.5800, it's highest since December 2014.