Sterling Rallies on Carney Comments

Sterling rallied on hawkish comments from BoE Governor Carney, erasing the rate’s post-election losses against a weaker dollar. Carney said that higher interest rates may become necessary if business investment and wage growth pick up, amongst a host of other considerations, and that the MPC would discuss this in the coming months.

Previous Day's Market Highlights

Sterling rallied on hawkish comments from BoE Governor Carney, erasing the rate’s post-election losses against a weaker dollar. Carney said that higher interest rates may become necessary if business investment and wage growth pick up, amongst a host of other considerations, and that the MPC would discuss this in the coming months.
 
Against the euro, the pound reversed Tuesday’s losses, regaining 1.1300 but continuing to meet resistance around 1.1400. Euro-dollar rallied further, breaking 1.1400 in overnight trading, a new one-year high.
 
Sterling-Aussie temporarily regained 1.7000 for the first time since the election, before retracing lower. Sterling also hit its highest levels against the kiwi since the election, but remains relatively unchanged against a stronger Canadian dollar.   

 

Currency Pairing 08:00 Today Vs 08:00 Yesterday Four-Week High Four-Week Low % Change
GBP / EUR 1.1367 1.1572 1.1261 2.69%
GBP / USD 1.2967 1.2978 1.2589 2.30%
EUR / USD 1.1406 1.1420 1.1119 2.64%
GBP/AUD 1.6916 1.7494 1.6612 5.04%
GBP / NZD 1.7746 1.8273 1.7338 5.12%
GBP / CAD 1.6890 1.7536 1.6721 4.64%

Today's Market Highlights

Sterling will continue to be in focus today as it hovers just below 1.3000 against the dollar. UK releases include Net Lending to Individuals and Consumer Credit (09:30 BST).
 
Markets will also keep an eye on the final round of voting on the Queen’s Speech; yesterday’s proposed amendment was defeated. Losing votes would indicate the government doesn’t have the House of Commons’ confidence.
 
US releases of note include final Q1 GDP and quarterly Core Personal Consumption Expenditures (13:30 BST). Final GDP may have limited impact barring any significant revision in either direction.

Today's Economic Calendar

Time Currency Release Consensus Previous
09:30 GBP Net Lending to Individuals MoM (May) £4.0B £4.3B
09:30 GBP Consumer Credit (May) £1.400B £1.525B
10:00 EUR Eurozone Consumer Confidence (Jun) -1.3 -1.3
10:00 EUR Eurozone Economic Sentiment Indicator (Jun) 109.5 109.2
13:00 EUR Preliminary German Consumer Price Index YoY (Jun) 1.4% 1.5%
13:30 USD Initial Jobless Claims (Jun 23) 240K 241K
13:30 USD Final GDP (Q1) 1.2% 1.2%
13:30 USD Core Personal Consumption Expenditures QoQ (Q1) 2.1% 2.1%
18:00 USD Fed's Bullard Speaks
00:01 GBP Gfk Consumer Confidence (Jun) -7 -5