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UK: waiting on a rate rise - Tuesday 28 July

6h ago
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For information visit our website currenciesdirect.com or email us at marketing@currenciesdirect.com. Lee Chappell is a Corporate Dealer at Currencies Direct UK. He lends us his expertise on a daily basis. UK data will be in the spotlight today (28 July), with Gross Domestic Product expected to grow by a rate of 0.7% on the previous quarter, which is better than the 0.4% it produced last time out. Anything below these figures will see the pound fall against its major counterparts. We have Bank of England mortgage approvals out on Wednesday (29 July), and those should also show a better-than-expected reading and reach 16-month highs. More positive data out this week will only have investors more expectant of a rate rise sooner rather than later, even though all nine members of the Monetary Policy Committee voted to keep interest rates on hold, for now. Eurozone has reason to be cheerful Yesterday (27 July) the much-anticipated German Ifo business climate index published positive figures of 108.0 against the 107.2 expected, causing GBPEUR to fall under the 1.40 barrier. On a somewhat good day for the euro, the International Monetary Fund had also said that the overall outlook in the Eurozone has been enhanced by: • the European Central Bank’s quantitative easing measures • rising exports (fragile currency) • cheaper oil prices After a relatively successful morning, GBPEUR found itself trading back above 1.40. Today sees the creditors’ meeting in Athens, so Greece will once again steal the limelight from data releases and no doubt cause volatility in all the euro-based currency pairings throughout the day. Shiny dollar After yesterday’s US durable goods figures produced better-than-expected results at 3.4% (against the forecast 3.2%), today’s data will be just as important for Janet Yellen. US dollar consumer confidence and Markit US Services Purchasing Managers’ Index figures are out later today, and with the US planning its own interest rate rise soon (possibly before end of 2015), it is key that all relevant data continues to shine.