Foreign Exchange Daily Market Update 17/08/2016

Wed, August 17, 2016

Pound Rises After Inflation Data

The Pound advanced versus the Dollar and wiped out earlier declines against the Euro after data showed that U.K. inflation progressed in July and there were signs of further price pressures due to the weak currency. Consumer-price growth grew to 0.6% from 0.5% in June, still well below the BOE’s 2% inflation target, which was last reached in December 2013. This is the first set of consumer-price data since the country’s decision to exit the EU.

Sterling has fallen around 13% against the dollar since the EU referendum. As a result, the BOE expects inflation to reach its 2% target a lot quicker than previously expected, though that didn’t stop it responding to Brexit threats with new stimulus this earlier month, including the first interest-rate cut since 2009.

The pound rose 1 percent to 1.3041 as of 09:21am. London time, the biggest gain since Aug. 2. It fell to as low as 1.2866 Monday, the lowest since July 11. Sterling was little changed at 1.1527 against the Euro. It earlier touched 1.1461, the weakest level since August 2013.

Data to look out for today.

09:30: GBP Jobless Claims

09:30: GBP Average Weekly Earnings

09:30: GBP Unemployment Rate

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PRESS RELEASE

KBRFX was mentioned in the Essex Chronicle for the top 100 companies by turnover in Essex http://www.essexchronicle.co.uk/100-Essex-businesses-revealed-annual-survey/story-25140555-detail/story.html

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