Sterling’s value has climbed this afternoon as market price in the expectations for the week. European and US data tomorrow, UK unemployment and Quarterly inflation report on Wednesday followed by UK GDP figures on Friday. The general expectation is that rates will climb for the pound this week and hence its value has started to climb today.
Longer term forecasts will focus on the vote in September on whether Scotland will leave the United Kingdom. This vote will certainly create some uncertainty and weaken the Pound in the run up as a result. Thereafter forecasts on interest rate change in the UK will probably lead market prices and forecasts. Information on this may be given at the Quarterly Inflation Report later this week. The view is that rates in the UK will be the first to start to climb but when and by how much is yet to be defined. Some people think it will be this side of the New Year, I however think it will be in 2015. In either case it will certainly be before another change is made by the Reserve Bank of Australia meaning that I expect the general trend to be GBPAUD positive. As a result if you are a seller you may therefore be wise to look at getting out of the AUD sooner rather than later – so the vote in Scotland could be the time to do this.
For a full breakdown on market movement, forecasts and prices please feel free to contact myself STEVE EAKINS via email@example.com