19th April - Weekly FX Update

GBP/EUR

Monday 9AM 19th April: 1.15385

Sterling failed to bounce back last week, once again falling below 1.15 early on Friday 16th April to 1.1471, the worst level in around two months. Even though it has since recovered slightly back above its support level, this certainly came as a shock after last weeks UK GDP was announced at 0.4% for February, indicating economic growth. The UK also saw a move to its next reopening phase on Monday which should have promoted optimism for the Pound, ultimately bearish investors outweighed those taking long positions on GBPEUR in the short-term. Eurozone date was also significantly mixed, and had a very limited impact on the Euro. Looking ahead to next week, confidence in the UK economy is high, and this should curb any further Pound selling. However, there is some ongoing concern regarding Scottish politics which has weighed on the Pound recently, with the parliamentary election going ahead on May 6th, the uncertainty could continue to make it more difficult for the Pound to gain any ground.

GBP/USD

Monday 9AM 19th April: 1.38747

The GBPUSD saw a slight recovery last week, spiking close to 1.39 this morning. The USD was largely affected by rumours of the Federal Reserve hiking rates, which made it much easier for other currencies to gain on the Dollar. Investors are somewhat reluctant to back the Pound ahead of Scottish parliamentary elections in a few weeks, however, with limited U.S. data releases, we still expect to see the GBPUSD re-approach the 1.40 mark in the near future.