The GBP/USD continued to gain today with the UK on Summer Bank holiday. The pound added 16 points to trade at 1.4619. Sterling climbed versus the dollar
The GBP/USD continued to gain today with the UK on Summer Bank holiday. The pound added 16 points to trade at 1.4619. Sterling climbed versus the dollar returning towards 12-week highs against a U.S. currency pegged back by expectations that the Federal Reserve is unlikely to raise interest rates any time soon.
Gains in the pound were capped, though, after a YouGov poll for the Times showed opponents of Britain’s European Union membership edging into the lead in the run-up to a June 23 referendum on the issue, despite an intervention on the “In” side by U.S. President Barack Obama.
The online survey, taken on Monday and Tuesday, showed support for the “Out” campaign had risen 3 percentage points to 42 percent since a similar survey on April 12-14, while the number of undecided had fallen, leaving support for the “In” campaign up 1 percentage point at 41 percent.
Despite the poll, bookmakers’ odds have consistently shown a vote for “Remain” the most likely outcome of the ballot, with betting website Betfair putting the chances of a Brexit at around just 30 percent. Those odds, closely watched by investors, have lent support to the pound.
“With 8 weeks to go the momentum does seem to be with the ‘Remain’ campaign,” said Bank of Tokyo-Mitsubishi UFJ currency strategist Derek Halpenny. “So far it has been a relatively orderly depreciation. There is a fair chance that investors will get a bit more nervous in the run-in.” (Reuters)
The UK unit continues to be buoyed by opinion polls suggesting that the ‘Remain’ campaign is beginning to pull out a meaningful lead in the EU In / Out referendum debate.
This morning’s government figures which revealed that the pace of expansion in Britain’s money supply slowed last month are unlikely to help the Pound in the short term.
The greenback continues to perform weakly in the global currency markets following yesterday’s significantly lower than anticipated US Gross Domestic Product data.
Futures markets are now pricing in a sizeable chance that America’s headline interest rate will still be at 0.5% come the end of the year, latest figures imply a 32.5% chance likelihood of this.
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Today’s economic releases:
Cur. | Event | Actual | Forecast | Previous | ||||
China – Labor Day | ||||||||
United Kingdom – Early May Bank Holiday | ||||||||
EUR | Manufacturing PMI (Apr) | 51.7 | 51.5 | 51.5 | ||||
USD | Manufacturing PMI (Apr) | 50.8 | ||||||
USD | ISM Manufacturing Employment | 48.1 | ||||||
USD | ISM Manufacturing PMI (Apr) | 51.5 | 51.8 |
Upcoming Economic Events that you should be monitoring:
Tuesday, May 3, 2016
Cur. | Event | Actual | Forecast | Previous | |||
Japan – Constitution Day | |||||||
AUD | Building Approvals (MoM) (Mar) | -3.0% | 3.1% | ||||
CNY | Caixin Manufacturing PMI (Apr) | 49.9 | 49.7 | ||||
AUD | Interest Rate Decision (May) | 2.00% | 2.00% | ||||
GBP | Manufacturing PMI (Apr) | 51.2 | 51.0 |
Government Bond Auctions
Date Time Country Auction
Mar 02 13:00 Norway Details of bond auction on Mar 04
May 04 11:05 Norway Holds bond auction
May 04 11:30 Germany Eur 4bn Apr 2021 Bobl
May 04 11:50 France Holds bond auction
May 04 17:20 Sweden Details of bond auction on May 11
May 05 10:30 Spain Holds bond auction
May 05 11:00 Austria Holds bond auction