A mixed week for sterling as it crept up against the euro but lost a bit of ground against the US dollar over the course of the week. However this doesn’t properly reflect the story of sterling’s week which centred on Tuesday’s growth figure, starting the week on an upwards trend amid optimism ahead of this release. The actual figure was at the lower end of expectations, causing an initial weakening of the currency, which ultimately reverted to a positive movement as investors digested the fact that this showed the first year round expansion since 2007. Sterling then had a relatively quiet rest of the week, with the other event of note being a speech by Bank of England (BoE) Governor Mark Carney, in which he stated that the BoE was not ready to raise interest rates for the time being.
Yesterday was then a mixed bag, as sterling lost ground against the dollar following the US Federal Reserve’s decision to further slow stimulus, but gained against euro thanks to the highest level of UK mortgage approvals in six years. Today sees a quiet one for the UK side, with no sterling data of significance scheduled, giving you the chance to reflect on whether to purchase currency at current rates, or to opt for forward-purchasing solutions.
This is very much dependent on where you think sterling is headed. Will UK economic growth continue to drive sterling momentum plus the possibility of interest rates rises earlier than forecast or will good news elsewhere undermine sterling? Get in touch with your trader now for the latest rates and guidance on a currency buying strategies which will help minimise risk.