Sterling launched itself into October with enthusiasm, bouncing up by close to a quarter of the percent this morning against the euro and most other currencies. However, it didn’t last long. That may be the pattern in the coming week, with only snack-sized bits of data and nothing much to provide long-term nourishment for sterling.
The only really interesting data release of the early part of the week was house prices this morning.
According to the Nationwide, house prices flatlined on a seasonally-adjusted basis in September, representing a 5.3% annual fall. The average British residential property is, therefore, now worth £14,500 less than last September. Even so, at least they didn’t fall further last month.
Other country’s economic performance will also affect sterling, and the US has a mass of reports coming out, including JOLTS employment data tomorrow.
With interest rates at an inflection point, large-scale currency traders will be looking for the best return on their money and looking for any sign that a country’s interest rate will be stronger than others. Hence a strong US labour market would suggest that the Fed can restart rate rises and the pound would probably weaken against the dollar (and potentially the euro too, these matters being fiendishly interconnected). On the other hand, the opposite could happen.
In the UK, the Conservative Party Conference has started today, and the Chancellor of the Exchequer Jeremy Hunt will be talking today. This could also affect sterling. So, if you would rather not tune into the Conference and would prefer to spend your morning making your plans to buy a property abroad, or whatever else you’re planning, why not give your trader a call on 020 8108 5163 and talk to us about how we can help you?
That might include fixing your exchange rate so you know exactly how much you have to spend, or you might choose to make the transaction today. At least you will know your options.
