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Foreign Exchange Daily Market Update 23/03/18

Fri, March 23, 2018

BOE Keeps Interest Rate Unchanged 

The Bank of England moved closer to raising interest rates as early as May after keeping the benchmark unchanged on Thursday.

The Monetary Policy Committee voted 7-2 to hold the rate at 0.5%. Policy makers wanted an immediate increase, arguing that slack in the economy has been used and wage growth is accelerating.

The pound jumped to an intraday high against the dollar and the strongest since June against the euro. It then lower gains to trade little changed at $1.4141 at mid-day London time yesterday. Market pricing of swaps curves implied an 86% chance of a hike in May.

U.K. data this week has showed the inflation rate slipped to 2.7% in February as the effect of the sterling’s Brexit-referendum drop faded, wages are now beginning to pick up, suggesting consumer spending may also increase.

The pound will strengthen against the euro as the market continues to price out Brexit premium risk. Danske sees the pound at 86 pence per euro in six months, from around 87 pence Thursday, and reaching 84 pence in 12 months. The bank sees sterling rising to $1.49 by the end of 2018 and $1.52 in early 2019.

The Bank of Russia’s rate decision is on Friday. U.S. government funding is due to expire at the end of the day on Friday. Dollar Spot Index rose 0.2%, rebounding from the largest drop since January. The euro fell 0.2% to $1.2310. The Japanese yen rose 0.7% to 105.36 per dollar.

 

Data to look out today.   

USD US Tariff Grace Period Ends

12:30 USD Durable Goods Orders

CURRENCY PAYMENTS MADE SIMPLE

 

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

Data Releases

Day Time Currency Event
FRI USD 12:10 USD Fed's Bostic Speaks on the Economic Outlook
FRI GBP 12:30 GBP BOE's Vlieghe speaks in Birmingham.
FRI USD 12:30 USD Durable Goods Orders
FRI USD 12:30 USD Durables Ex Transportation
FRI USD 12:30 USD Cap Goods Orders Nondef Ex Air
FRI USD 12:30 USD Cap Goods Ship Nondef Ex Air
FRI USD 14:00 USD New Home Sales
FRI USD 14:00 USD New Home Sales (MoM)
FRI USD 14:30 USD Fed's Kashkari Speaks in Moderated Q&A
FRI USD 17:00 USD Baker Hughes U.S. Rig Count
FRI USD 23:00 USD Fed's Rosengren Speaks at International Research Forum
FRI EUR EUR German Import Price Index (MoM)
FRI EUR EUR German Import Price Index (YoY)

Foreign Exchange Rates

GBP / USD 1.41136
GBP / EUR 1.14390
EUR / USD 1.23315
GBP / CAD 1.81979
GBP / AUD 1.82571
GBP / CHF 1.33421
GBP / CZK 29.0503
GBP / DKK 8.51081
GBP / HKD 11.06287
GBP / INR 91.6240
GBP / JPY 147.860
GBP / MUR 45.99
GBP / NOK 10.94914
GBP / NZD 1.94707
GBP / PLN 4.82266
GBP / SEK 11.65128
GBP / SGD 1.85346
GBP / THB 43.9944
GBP / TRY 5.58775
GBP / ZAR 16.61743

*These are indicative rates only, based on interbank prices at the time of writing. For exact rates please contact our dealing team

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