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British Pound (GBP) LIVE: Sterling in Steady Recovery After Services PMI Delivers a Blow
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British Pound (GBP) LIVE: Sterling in Steady Recovery After Services PMI Delivers a Blow
Mar 22, 2024 2:18 AM

Last Updated: 07 April 2014

Updated: The British Pound (GBP) is stable as we move into the second week of April. Selling on global equity markets has seen some relief being enjoyed against the commodity dollars. Meanwhile, we continue to see consolidation vs the Euro and US dollar.

This period of consolidation will inevitably give the sterling bulls hope that the 2014 rally can ultimately reassert itself.

For the latest, see our live coverage section. For the archived material you clicked for, please scroll down.

Exchange Rates as of Last Update

Live to the minute rates:GBP vs Euro: 1.1701

vs Dollar: 1.2696

vs Australian Dollar: 1.9543

vs Canadian Dollar: 1.7264

vs New Zealand Dollar: 2.0903

vs Rand: 24.1087

PLEASE NOTE: The above quotes are taken from the inter-bank markets. Your bank will then affix their own discretionary spread when passing on a retail rate. However, an independent FX provider will guarantee to undercut your bank's offer, thereby delivering up to 5% more currency. Please learn more here.

16:19: GBP setback temporary in nature

KBC Markets on today's GBP performance:

"Sterling was also under pressure in Asia this morning as cable dropped below the 1.64 barrier. The European EMU PMI’s had hardly any impact on EUR/GBP trading. The UK services PMI declined unexpectedly from 60.0 to 58.8. This is far from a disaster, but sterling lost temporary ground, both against the dollar and the euro. Cable filled offers in the 1.6440 area. EUR/GBP jumped to the 0.8330 area. 

"However, the setback in sterling was again temporary in nature. Both EUR/GBP and cable reversed the post PMI moves."

15:18: Sterling in strong recovery

The British pound has continued to gain in confidence through the course of today ensuring much of the damage witnessed in the morning session has been largely erased.

GBP/CAD has made some strong gains - the exchange rate is now 0.38 pct higher at 1.7531 after hitting a low of 1.7355 earlier.

GBP/EUR is now 0.18 pct lower at 1.2061; the rate had earlier challenged 1.2.

14:48: GBP/USD bounce taking shape

Matthew Weller at GFT tells us he is backing the GBP to bounce further against the USD in the short term:

"Like its mainland rival, the GBP/USD also showed signs of bouncing after a selloff to start the week. From a candlestick perspective, the GBP/USD just put the finishing touches on a relatively large 4hr Piercing Candle. This candlestick pattern shows a shift from selling to buying pressure and may mark a near-term low in the pair. Any bounces that do emerge could find resistance at the 61.8% or 78.6% Fib retracements in the lower-1.6400s."

13:13: Sterling forecasts for 2014

Kathy Lien at BK Asset Management tells us where she is forecasting the EUR/GBP, GBP/JPY and GBP/USD in 2014:

"Between the outperformance of the U.K. economy versus the Eurozone economy and the divergence in BoE/ECB monetary policy direction, we expect EUR/GBP to test 80 cents in the coming year.

"While the key support level for the pair is the 2012 swing low of 0.7756, we don’t expect this level to be tested unless the Bank of England raises rates in 2014 (which is very unlikely) or the ECB cuts rates to negative levels (possible but not probable).

"Buying GBP/JPY on the other hand is both a U.S. recovery and global growth trade. Short-term resistance is at 175 but the more significant resistance level is 180.

"Finally, with the BoE holding monetary policy steady as the Fed tapers, higher U.S. rates should lend support to the greenback, offsetting demand for sterling. This means we expect GBP/USD to trade in a 1.67 to 1.60 trading range in the coming year."

12:40: ECB unlikely to change policy

Bank of America Merrill Lynch analyst Nick Bate reckons the ECB is likely to keep policy on hold in 2014 - a pro-EUR view:

"We expect the ECB to remain on hold at their meeting this week and for most of 2014, with their Comprehensive Assessment (CA) of the banking sector potentially posing more risks of prompting action through the year in the form of another LTRO should liquidity conditions deteriorate than the immediate GDP growth outlook."

12:22: GBP still tipped higher vs EUR

The Euro is enjoying a bounce against the pound today, however the technical outlook continues to favour the GBP.

Geoffrey Yu at UBS says:

"With the MACD firmly below its zero line, there’s potential for extensionof the bearish trend. Support is at 0.8253, a break below which wouldexpose 0.8160. Resistance is at 0.8346."

11:42: Support for GBP must hold

The uptrend in GBP/USD remains intact… for now.

Luc Luyet at MIG Bank gives his latest forecast for GBP/USD:

"GBP/USD has declined sharply after posting new highs. Supports can be found at 1.6305 and 1.6220. A break of the resistance at 1.6474 is needed to improve the short-term technical structure.

"The break of the major resistance area between 1.6381 and 1.6466 favours a further long-term rise towards the strong resistance at 1.7043 (05/08/2009 high). However, monitor the recent bearish reversal near the resistance at1.6618 (19/08/2011 high). A break of the support at 1.6220 would negate the positive outlook implied by the recent new highs. Another key resistance lies at 1.6747 (28/04/2011 high)."

10:53: Deutsche Bank upgrade forecasts for GBP

Deutsche Bank, in their latest exchange rate forecast note, advise they are increasingly bullish on GBP:

"We are turning less bearish on GBP and meaningfully raising our sterling forecast profile for the coming year. The driver has been the large upside surprise in the growth outlook this year, in turn providing belated interest rate and flow support to the pound."

10:11: Growth in 2014 likely to be strong

The British pound has taken a punch from today's below-par Services PMI. However, Markit are upbeat with regards to the year ahead for the UK's Services Sector:

"The positive trends in activity and new business are widely expected to continue in 2014. Optimism amongst the survey panel regarding activity over the next 12 months was at its highest since March 2010, with well over 50% of respondents forecasting growth. Investment in capacity, new products and marketing platforms was also noted as a reason to be confident heading into 2014."

Full release from Markit on today's disappointing PMI data found here.

09:33: GBP sell-off accelerates as Services PMI fails to deliver

Sterling is deep in the red as today's only hope for a respite to recent selling pressure only throws fuel onto the flames.

UK PMI Services came in at 58.8 versus 60.0 prior and 60.3 expected.

08:55: Deeper British pound correction ahead?

The correction in sterling could run yet further.

"The Cable started the week downbeat. GBPUSD sell-off accelerated as the 21-dma (1.6399) was broken on the downside. Technical indicators warn of deeper correction for a close below 1.6400. First level of support should come into play at 1.6317 (fibo 38.2% on Nov 13’ – Jan 14’ rally), while light stops are seen below 1.6300/1.6280." - Swissquote Research.

08:43: GPB/USD to be driven by USD sentiment

"There are a number of releases from the UK this week, BoE MPC meeting, industrial production and trade data. However, with no policy change expected from the BoE and these data largely second tier, GBP/USD will likely be mainly influenced by USD sentiment given key releases from the US this week." - Lloyds Bank Research.

08:40: The British pound is in the red

A poor start for the British pound (GBP) on Monday morning; the UK currency is in the red against the majority of major currencies. As far as we can tell at this stage the move lower is correctional - a strong run has run out of steam.

08.30: Services PMI ahead

Services PMI will be a focus. While manufacturing PMI fell in December, more than expected, the market is expecting a modest rise in Services PMI to 60.3.

"Our economists view that given the sharp drop in November, risks are to the upside today. Should we see a stronger outturn this will likely provide some respite for GBP/USD which has been under pressure since the start of the new year." - Lloyds Bank Research.

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