• About Us
  • Authors
  • Currency Charts
  • Live Exchange Rates
  • Contact Us

Exchange Rate Forecast

Exchange rate forecasts and foreign currency news

  • British Sterling
  • Euro
  • US Dollar
  • Australian Dollar
  • Canadian Dollar
  • Brexit News
You are here: Home / Euro / Sterling Sell-off Ahead of US and Japan Monetary Decisions

Sterling Sell-off Ahead of US and Japan Monetary Decisions

September 13, 2016 by Ben Fletcher

Sterling Sell-off Ahead of US and Japan Monetary Decisions

Janet_Yellen_official_Federal_Reserve_portraitThe US Federal Reserve and the Bank of Japan will next week make major announcements on interest rates and policy decisions. The Federal Reserve’s agenda is one of the best kept secrets currently and is having a major effect on Sterling currently. Investors around the globe are waiting for the Fed to make a decision on the 21st September and have started to sell off their Sterling positions. The pound had shot up in the last week against the Euro just falling short of 1.20.

The recent spike now seems a long way off as preparations are made for further weakness if the Fed does increase their interest rate. Fed Chairlady Janet Yellen nearly a year ago suggested we could have 4 rate hikes this year however after one in 2015 and none since the markets are getting restless, especially as the conditions in America seem perfect for a hike.

The GBP/EUR rate looks likely to sit around this level for another few weeks until the interest rate decision is made. In my opinion there won’t be a hike this year as there is major uncertainty in the US with the general election coming in November, despite the FED’s supposed independence from the US Government.

Therefore I believe the GBP/EUR will move over 1.20 before the end of September when investors put their money back in Sterling. The Euro has recently become a risky currency as it appears there are cracks appearing amongst nations. This is only adding to the existing problems with the banking sectors and the migrant crisis.

Therefore, if you are buying Euros in the near future, the US elections will likely create some opportunities before the UK withdraws its membership from the EU. I would be cautious of holding off until 2017, as this is when the invocation of Article 50 is expected.

Filed Under: Euro Tagged With: GBPEUR, Pound strength, US interest rate

The information on this website is provided for information purposes only. It does not constitute advice to any person on any matter. Every reasonable effort is made to ensure that the information is accurate and complete but we assume no responsibility for and offer no warranty with regard to the same.

Recent Posts

  • Sterling finds support but unlikely to make any significant impact in the coming days May 9, 2018
  • US Dollar hits 5 month high against Sterling May 2, 2018
  • Sterling exchange rates at the mercy of political developments May 1, 2018
  • Pound weakens as political uncertainty once again raises its head May 1, 2018
  • Will Mario Draghi’s speech impact GBP/EUR? April 26, 2018

Live Exchange Rates

Archives




Copyright © 2021 — Currency.co.uk • All rights reserved. • Exchange Rate Forecasts • Privacy Policy •

We use cookies to ensure that we give you the best experience on our website. By using this site you agree to receiving cookies.I agreeRead Privacy Policy