Sterling strengthens while Euro & Dollar weaken- But for how long?

On Monday we saw massive weakness in the U.S Dollar and the Euro with exchange rates against Sterling climbing back up- With UK elections round the corner I am sure many of you are wondering how long this will last; For those of you who are looking to carry on transactions over the next few days- below are the data releases to be aware of.

Tuesday

On Tuesday we have the UK GDP figures releasing at 09:30 GMT, expected to come in weak by -0.3%, this could have an instant reaction on the Pound as a low GDP reading during UK election time can have an adverse effect on the current government trying to get voted back in. It is always worth noting however that data releases do not always come out as expected, so though the expectations are weak on this, it is smart to hedge your bets as it could go the other way.

Wednesday

The next data releases of importance are on Wednesday, First of all Germany will release it's CPI figures (Inflation) and these are expected to come in weak on the month, but stronger than last year- my expectation on this is that the market will see this as the ECB QE plan working as the figures are better than last years. Later on Wednesday we will see GDP figures coming out of the U.S which are also expected in weak. Many of you may be aware that the U.S have been flirting with the idea of an interest rate hike for the last few months, and the plan was to only do a rate hike on the back of strong economic figures, which was why we saw the GBPUSD exchange rates below the 1.50 area for so long. What we have now started seeing is weak figures from the U.S for the last few weeks, this has now put weakness back into the Dollar and put us back over the 1.50 level. For those of you who are purchasing the U.S Dollar I would suggest that it is worth looking into tools such as forward contracts to take advantage of these exchange rates before the U.S economy gets back on track towards an interest rate hike.

If you would like any further information or analysis on your current situation then please don't hesitate to contact me, I guarantee an unbeatable exchange rate with no transfer charges whatsoever and a same day payment.

Email- prem.raja@currencies4you.com