Pound Sterling Exchange Rate News: Widespread Losses after ‘Hard Brexit’ Fears Voiced
Pound Sterling exchange rates have made a number of sizable losses today, having slumped by -0.2% against the South African Rand and by -0.4% against the Israeli New Shekel, among others.
This lack of confidence in the Pound has mainly come from signs of low confidence in the UK’s financial sectors, particularly in the UK’s economic heart, the City of London.
A recent Confederation of British Industry (CBI) report has shown a drop in optimism for Q3, representing the longest decline in sentiment since the financial crash of the late 2000’s.
The manner of the UK’s exit from the EU has been a pressing point in the financial sector, with a less-desirable ‘Hard Brexit’ being linked to quickly exiting the EU to secure border control, at the cost of losing highly-prized single market access.
UK Economic Outlook: Bank of England (BoE) Speeches and Q2 GDP Stats Out This Week
The next UK economic announcements to watch out for will consist of BoE official speeches, consisting of remarks from Andy Haldane tomorrow and Nemat Shafik on Wednesday.
The big news of the week, however, will come on Friday, when the finalised Q2 GDP growth rate figures are due to be announced. On both the month and the year, gains are expected.
While this would usually be good news, the fact that both results cover the pre-Referendum period may result in even supportive data having little actual positive impact.
South African Rand Update: Calls for Zuma to Step down Raise Confidence in Future South African Governance
The South African Rand has managed to hold off three of its major rivals today, rising against the Pound, Euro and US Dollar by small degrees.
While no direct economic data has been out recently, the Rand has still appreciated due to signs that the long and controversial presidency of Jacob Zuma may be coming to an end.
In addition to Zuma’s brother imploring the President to stand down to prevent any assassination attempts, the important National Union of Mineworkers has thrown its support behind current Deputy President Cyril Ramaphosa to become the nation’s next President.
South African Rand Forecast: Confidence, Trade Balance and Manufacturing Data due in Near-future
South African domestic data will be fairly thinly spread in the future, consisting mainly of Friday’s confidence and trade data as well as next Monday’s manufacturing PMI for September.
Friday morning’s Q3 consumer confidence result is forecast to improve marginally from -11 to -10, while the August trade surplus has a reduction in store from 5.22bn to 3.6bn.
For Monday’s Barclays Manufacturing PMI, a positive movement from 46.3 to 49.3 is forecast, although this will still leave the nation’s manufacturing in a state of contraction (a figure above 50 signifies growth).