It was reported on 29 August 2013 that the British pound had succeeded in breaking a three week low against the neighboring Euro. The gains come after a series of statements by the new Bank of England Governor Mark Karney that left investors unimpressed regarding his intentions on the future of interest rates.
Analysts also point to the fact that the pound remains a fairly volatile currency at this time in the market. Many observers pointed to Karney’s speech as having been neither hawkish or dovish enough to infuse any sort of confidence in the market, thus leaving many guessing as to what direction the Bank of England will take in providing sufficient space for lending from the nation’s banks.
While the pound was able to make ground against the Euro, it is said to have lost out to the American dollar which with the apparent onset of a looming conflict in Syria has become a haven asset for many investors.
Investors are advised to proceed with caution in trading the pound in the coming days due to the higher levels of volatility in the market
Eurozone CPI Report to be Released Friday
The Consumer Price Index for the European monetary union is set to be issued on Friday, 30 August 2013. At this time, many experts believe that the CPI for the EU countries will likely remain unchanged.
That said, analysts remind readers that weak and failing economies in member states such as Greece, Spain and Portugal may serve to drag down the progress of the more northern countries.
Analysts point to countries such as the economic powerhouse Germany and France that have helped to bolster the EU’s economy, The success of these two economies will likely have a considerable influence that changes in the overall CPI can have on interest rates in the rest of the Euro Area.
It should be noted that the Euro has enjoyed a strong streak of gains against its rivals over the past week as has been reported in previous reports. Traders are advised to exercise caution amid speculation on the Euro in the lead up to the report. Some volatility can be expected in the coming days in trading for the Euro against peer currencies.
Canada to Release GDP Report for June
The report covering the Gross Domestic Product figures for the month of June will be issued tomorrow Friday 30 August 2013. While many experts are unsure as to what direction the report will point to, it is believed that the GDP report covering the Q2 will indicate a decline of significant proportions.
Analysts note that the Canadian economy has experienced a series of highs and lows over the course of the past month as its primary export, crude oil, has shifted in value. Readers are reminded that the Canadian economy is closely tied to the valuable oil commodities market. Over the month of August, the prices at the US West Texas Intermediate have been fairly volatile, along with concerns over deliveries from the Middle East, often helping to boost gains for the loonie. That said, Canada has also lost out a fair number of times due to growing confidence by investors in the value of the US economy that has been enjoying a relatively strong rebound in their recovery.
Analysts advise investors to proceed carefully in trading the CAD as the release of the report is likely to add further volatility to the currency’s value following its issuance.