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Pound Exchange Rate Forecast: GBP/EUR, GBP/USD Events this Week

October 30, 2018 6:30 am | Modified October 29, 2018 5:18 pm
EUR, GBP, Politics, USD | BY Charlie Murray

The week ahead has plenty in store for the Pound Euro (GBP/EUR) and Pound US Dollar (GBP/USD) exchange rates. Whether it’s political developments in Europe or high-tier data in the US, there’s a number of factors that could turn investor heads this week. 

Pound (GBP) Exchange Rate Awaiting BoE Interest Rate Decision

The Pound’s main event in the week ahead will be the Bank of England’s (BoE) interest rate decision on Thursday. The central bank is largely expected to keep interest rates on hold in the run-up to Brexit, but there’s the potential for market-moving comments when BoE Chief Mark Carney speaks after the decision. Carney’s comments could be influential for the Pound exchange rate on many levels, especially when discussing Brexit and the future of monetary policy.

UK Consumer Confidence stats will be out on Wednesday, while the latest Markit UK Construction reading will be out on Friday.

Euro (EUR) Waiting for Italian Growth Figures amid Budget Row

Tuesday is likely to be a busy day for the Euro exchange rate when a raft of Eurozone data comes to light. The French growth number will be out first, followed by the German Unemployment Change and Unemployment Rate figures. As the session continues, Italian growth numbers will be released which could contribute towards the current debate between the Italian government and the European Commission.

Eurozone Gross Domestic Product (GDP) will be out following this with figures pegged to fall in the third quarter from 2.1% to 1.8% which may not bode well for the Euro exchange rate. Later in the afternoon, the German Consumer Price Index (CPI) will be revealed. Wednesday will continue on with the influential data
when the Eurozone inflation reading comes to light. A slight rise is expected in October, from 2.1% to 2.2%.

US Dollar Investors Eye Non-Farm Payrolls

US Consumer Confidence will be the main economic event on Tuesday, with expectations for a decline in sentiment. Wednesday will continue with the latest ADP Employment Change figure; the ecostat can be influential for the US Dollar exchange rate as it’s usually seen as a precursor to Friday’s Change in Non-Farm Payrolls.

Thursday will heat up with the ISM Manufacturing and ISM Employment figures, ahead of Friday’s payrolls stat. While the US Unemployment Rate is expected to hold steady at 3.7%, the Change in Non-Farm Payrolls number is expected to come in at 193K, slightly ambitious after last month’s 134K disappointment.

On Monday the GBP/USD exchange rate was trading between levels of 1.2792 and 1.2852. The GBP/EUR exchange rate was trading between 1.1207 and 1.1275.

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