by Peter Lavelle

Welcome to my latest forecast for the US dollar to pound exchange rate.

The greenback could soon gain against sterling!

The US dollar may rise against the pound in July, if incoming Bank of England governor Mark Carney decides to inject more monetary stimulus into the UK.

Recently, Mr. Carney said that central banks were not “maxed out,” suggesting he favours more stimulus for the UK.

This would weaken the pound, because the more stimulus Mr. Carney injects, the weaker the pound becomes.

In fact, Mr. Carney may want the pound to weaken, because this would help the UK export more.

Given that, look for the US dollar to rise against the pound, when Mark Carney takes charge at the Bank of England in July!

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by Peter Lavelle

Welcome to my latest update of the euro to pound exchange rate.

The euro shoots up – but it may struggle to climb further!

The common currency has hit a 3-week high against the pound today, the best exchange rate since May 30th, at 0.8585.

Why? For one, because German businesses grew more optimistic last month, according to a survey by ZEW.

This has lifted the euro, because Germany is the Eurozone’s biggest economy.

In addition, the pound has fallen, as inflation in the UK rose to 2.7% in May.

This has brought down the pound, because higher inflation means people have less money to spend.

However, though the common currency is strong now, it could struggle to reach fresh heights.

This is because economic data from the UK has been remarkably upbeat recently, which will give the pound a boost.

For instance, the UK is forecast to expand +0.6% between April and June, which is just what sterling needs to rise.

Hence, this could be the euro’s peak against the pound for the moment!

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by Peter Lavelle

Welcome to my latest update of the pound to Australian dollar exchange rate.

Sterling could soon hit fresh record highs!

The pound could exceed its recent 3-year high against the Australian dollar in the near future, if the Reserve Bank of Australia (RBA) cuts interest rates.

Yesterday, the RBA said it might cut interest rates below their current 2.75%, “should that be required.”

This would further lift the pound against the Aussie dollar, because the lower interest rates go in Australia, the cheaper the Aussie becomes.

“The RBA is giving the green light for the Aussie to go lower,” as David de Garis of NBA said yesterday.

Earlier this month, the pound hit its highest against the Australian dollar since September 2010, or almost 3 years, at 1.6675.

Since the start of this year, sterling has climbed 7.79% against the Aussie.

Now, the pound could climb even higher, before the year is out.

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by Peter Lavelle

Welcome to my latest update of the pound to Canadian dollar exchange rate.

Sterling goes up, up and away!

The pound is close to its highest against the Canadian dollar in more than 5 months today, or since January 2nd, at 1.6018.

Why? Well, it’s thanks to reports that the US Federal Reserve might cut back its stimulus this week.

Since the start of 2013, this stimulus has artificially lifted the Canadian dollar, as investors take that American cash and put it in Canada.

Hence, reports that the Fed might turn off the tap have now brought down the loonie.

However, in spite of this Fed action, I think the pound will struggle to reach fresh heights against the loonie.

This is because the Canadian economy is really taking off lately, which will lift the Canadian dollar.

For instance, Canada created 95,000 jobs in May, the highest figure in a decade.

Meanwhile, the Bank of Canada is poised to lift interest rates above 1.0% soon, which will also strengthen the loonie dollar.

Given that, yes, the pound is at a 5-month high against the Canadian dollar now, but it may soon fall.

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by Peter Lavelle

Welcome to my latest forecast for the US dollar exchange rate.

The greenback looks set to climb!

The US dollar could soon gain across the foreign exchange market, if the US Federal Reserve says this Wednesday that it will stop printing so much money to stimulate the US economy.

Since the start of this year, the Fed has printed $85 billion a month in an attempt to make the US economy grow faster.

However, this has prevented the US dollar climbing on the foreign exchange market, because the more bucks the Fed prints, the less each one is worth.

However, economic data in the US has improved recently, with retail sales rising +0.6% last month for example.

This has led to talk of the Fed ending its stimulus program.

Hence, if the Fed signals an end to its stimulus at its meeting this Wednesday, that will give the US dollar a hearty boost on the foreign exchange market.

In other words, look for the greenback to gain this week!

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by Peter Lavelle

Welcome to my latest forecast for the pound to euro exchange rate.

The pound to euro exchange rate seems to be stuck!

For 3 weeks now, the currency pair has stood at 1.17, like a DVD on pause.

Moreover, for the foreseeable future, there seems to be little chance of sterling breaking higher against the euro.

The reason, if you can believe it, is that there’s good economic news from both the UK and Eurozone.

In Blighty, the economy is set to expand +0.5% in the second quarter, as Markit’s Chris Williamson notes the UK is now “firing on all cylinders.”

Meanwhile, in the Eurozone, Germany’s factories churned out +1.8% more goods than forecast in April, which bodes well for the future.

Given that, there’s reason to feel upbeat about both the pound and euro right now.

Unfortunately, that means the exchange rate could remain at a standstill. If you plan to explore Paris for instance, 1.17 is what you can expect!

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by Peter Lavelle

Welcome to my latest update of the Australian dollar to pound exchange rate.

The Australian dollar has been “doing it tough” against the pound recently, and last week fell to a 3-year low of 0.5997.

However, in spite of that, the Aussie’s fortunes could soon turn around. Australia’s currency may rebound, at least partially, against sterling.

How come?

Well, first, because investors have been selling the Aussie like it was going out of fashion. That’s led some people to think the dollar is now weaker than it ought to be, so they’re buying it back.

Second, the Australian dollar has been falling because Australia’s economy isn’t doing as well as it once was. Nonetheless, Australia is still in good shape.

For instance, Australia’s unemployment rate fell -0.1% to 5.5% in May, among the lowest in the industrialised world.

Furthermore, Australia is forecast to expand 2.0% this year, far faster than most other developed countries.

These are good reasons for the Australian dollar to strengthen.

Given all this, the Australian dollar is down, but it is certainly not out. Look for the Aussie to tread higher against the pound in the near future!

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by Peter Lavelle

Welcome to my latest update of the US dollar to pound exchange rate.

The US dollar could be due to rebound!

The greenback hasn’t had it easy against the pound lately, yesterday falling to a 17-week low of 0.6359.

However, in spite of this, it may be time for the US dollar to fight back, and reclaim some ground against sterling.

Why? Because evidence is mounting that the US economy is in great shape again.

For instance, the amount US shoppers spent on Main Street jumped by +0.6% in the month of May, way above the +0.1% forecasts.

If people are getting out their wallets, it’s a sure sign the US economy is set to grow.

Moreover, the number of people claiming unemployment benefits for the 1st time in the States grew less quickly last week too, at just 334,000, or 2,000 less than economists had pencilled in.

The fewer people who’re claiming the dole, the better the US economy is doing, clearly.

Given all this, there’s good reason to think the greenback could soon bottom against the pound, and begin to climb its way back up.

In other words, before too long, we could be looking at a resurgent US dollar!

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by Peter Lavelle

Welcome to my latest update of the euro to US dollar exchange rate.

The euro keeps climbing!

The common currency has hit 1.339 against the US dollar today, its best exchange rate since February 20th, or 4 months.

By contrast, the euro was as low was 1.2751 against the buck on March 27th. Hence, it’s since gained more than 5 cents, or +5.01%.

A €250,000 transfer would hence be worth $15,975 more today than on March 27th.

(Please bear in mind, these are the interbank rates at the time of writing. This means the exchange rate may have changed since then.)

However, the euro could soon peak against the greenback.

This is because the European Central Bank’s monthly report could signal the bank plans to cut interest rates below 0.5%. This will weaken the euro.

It’s also because US retail sales are forecast to have expanded 0.4% in May, +0.3% more than April. This will lift the US dollar.

Hence, this could be the best time to buy euros for US dollars for the foreseeable future!

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by Peter Lavelle

Welcome to my latest forecast for the pound to euro exchange rate.

Sterling has held close to 1.17 against the euro since the end of May, but evidence is now mounting that the pound will gain sharply in the 2nd half of this year.

Here are 5 reasons why:

1. The UK is forecast to expand +0.5% between April and June, much faster than the first quarter’s +0.3%. This will lift the pound.

2. “For the first time in a year, manufacturing, services and construction [in the UK] are all reporting higher levels of activity,” says Markit’s Chris Williamson. This will also strengthen sterling.

3. UK industrial output has risen for 3 months on the trot, with an outstanding +0.9% gain in mining in May. This too will make the pound stronger.

4. Meanwhile, unemployment in the Eurozone is at an all-time high of 12.2%. This will bring down the euro.

5. Furthermore, the Eurozone has been in recession for 18 months, and is -1.1% smaller than this time last year. This too will weaken the common currency.

Hence, look for the pound to shoot up against the euro in the 2nd half of 2013!

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We’ll tell you when the best exchange rate becomes available.