GBP Boosted by a Bullish UK Consumer, EUR-GBP heads below 0.8550 on supported UK yields: Friday's Live Coverage

After a slow couple of days the British Pound Sterling (Currency:GBP) finally has some data points to latch onto this Friday. We have already heard from GfK and Nationwide; consumer confidence data proved positive for GBP. Lending data from the Bank of England proved broadly positive although lending to businesses continues to decline. Also note some safe-haven flows bidding sterling higher as equity markets turn red.

Highlights:

@ 09:30: Bank of England lending data broadly positive
@ 14:48: Scotiabank forecasting 1.45 in GBPUSD at year end

@ 15:00: Lloyds report leap in confidence for UK businesses' trading prospects

Updated Rates (As of most recent post).

• GBP/EUR is 0.06 pct higher on a daily basis at 1.1716.
• GBP/USD is 0.18 pct lower at 1.5477.
• GBP/AUD is 0.05 pct lower at 1.7356.
• GBP/NZD is 0.06 pct lower at 1.9947.
• GBP/ZAR is 1 pct lower at 15.9134. Alert

NB: The above are spot market quotes, your bank will subtract their own spread when passing their retail rate. However, an independent FX provider will guarantee to undercut your bank's offer, thus delivering you more currency. Please learn more here, or use our custom live vs retail currency converter.

15:32: PMI's are back - BEWARE the risks to Pound Sterling

Next week we get August PMI data; July's data released at the start of this month gave sterling a great shot in the arm.

Ross Walker at RBS is warning this month could be more tempered, a potential negative for GBP:

"The coming week's data flow may come to the aid of the doves. The magnitude of the recent gains in the PMI surveys means that the risks of a modest retracement are growing – we forecast small declines in the services and manufacturing PMIs alongside a fall in ONS industrial production in July after an outsized gain in June."

15:00: UK businesses' trading prospects at highest level since October 2007

Lloyds Bank Commercial Banking Business Barometer 'monthly snapshot' for August shows:

UK companies' optimism about the UK economy continues to improve and is at the highest level since February 2010.

Businesses' confidence in trading prospects remains at the highest level since October 2007.

The net balance of businesses that are optimistic about economic prospects - which weighs up the percentage of firms that are now more optimistic than they were three months ago against those that are more negative - increased by 13 points to 54 per cent in August.

Further analysis shows a two percentage point increase, to 63 per cent, in the number of businesses that are more optimistic about the economy than they were three months ago.

14:48: US Dollar strength into year end

More on the currency forecast front from Camilla Sutton (See previous) who sees GBP/USD 1.45 come year-end:

Scotiabank’s FX forecast continue to call for broad USD strength into year‐end; with the majors of JPY, GBP and EUR underperforming, calling for year‐ends of 105, 1.45 and 1.25, respectively.

We also expect CAD to fall under pressure, losing 2% into year‐end. For the most part our forecasts are built on relative monetary policy, growth outlooks, sentiment and core fundamentals.

12:55: Outlook for GBP/USD has deteriorated rapidly

Camilla Sutton at Scotiabank says the outlook for GBPUSD has turned south:

"The technical outlook for GBP has deteriorated rapidly. The MACD is firmly in sell territory, spot is breaking below the 200‐day MA (1.5510) and spot has formed a fresh downward trend.

"We expect a near‐term test down to the 100‐day at 1.5359 and are biased to be short."

For further GBPUSD views, see our latest article on the matter.

10:45: UBS forecasts for GBP/USD, EUR/GBP

Gareth Berry at UBS gives today's forecasts for the British Pound:
GBP/USD: "The pair is consolidating and with momentum pointing lower, the risk appears to be more weakness to test the strong support at 1.5373. Resistance is at 1.5573 ahead of 1.5718."

EUR/GBP: "The sharp sell-off over the past few sessions was staged from the resistance at 0.8669. This reinforces the bearish theme and first support is at 0.8505, a breach of which would expose 0.8467."

10:00: UK SME's being starved of cash

There are two ways of looking at today's business lending figures.

The first - businesses just don't want credit
The second - banks don't want to lend.

Goncalo de Vasconcelos, founder of equity crowdfunding platform, SyndicateRoom says:

"Britain's smaller businesses continue to be starved of the oxygen required to grow and, in many cases, survive.
"In July lending to SMEs went off a cliff, decreasing by £0.9 billion. This compares to an average monthly decline of just £0.2 billion over the past six months.
"While the economy as a whole may be improving, for the smaller business seeking to raise finance things are getting noticeably worse.
"Ironically, repayments by SMEs were £4.1 billion in July, compared to a monthly average of £3.5 billion over the past six months.

Of course, de Vasconcelos would argue the second point as he is, by profession, an alternative to the banks.

09:35: Bank of England lending figures are out

Consumer Credit (July): 0.6BN, this was in line with expectations.
M4 Money (MoM July):  Up 0.6 pct, a beat on 0.4 pct.
Mortgage Approvals (July): 60.624K vs 60.624K expectations.
UK Net Lending to Individuals (MoM) (July): 13 BN versus 1.1 BN.

09:15: EUR/GBP supported by higher yields

Emmanuel Ng at OCBC Bank says:

"The GBP-USD continued to test lower on Thursday with the pair dipping below 1.5500 briefly with the firmer broad dollar overshadowing any GBP  resilience.

"On the latter point, we note however that the EUR-GBP headed south below 0.8550 on the back of supported UK yields.

"Going ahead, if pair manages to drill below 1.5500 (200-day MA at 1.5507), expect the complexion for the pair to turn perceptibly top heavier."

09:00: British Pound in solid start to Friday's trade

The spot markets show the British Pound Sterling (Currency:GBP) to be trading in positive fashion, particularly against an under-pressure Euro. The 1.17 level is proving to be a magnet in late summer trade in GBP/EUR.

08:50: UK consumers turning bullish, Nationwide house price data eases

Setting a positive tone for Sterling trade today was the midnight release from GfK that showed consumer confidence rose more-than-expected last month.

Consumer confidence rose to a seasonally adjusted -13, from -16 in the preceding month.

Analysts had expected a reading of -14.

@ 07:00 The Nationwide Housing Price release saw growth of 3.5 pct (YoY), down from a previous 3.9 pct.