Pound Forecast

The fiscal straight-jacket of the UK's fiscal rules means the feel-good factor for the Pound can soon end.

In our previous edition of the Week Ahead Forecast, we opined that the Pound to the New Zealand Dollar was due to a pullback from notably overbought conditions.

The Pound to Dollar exchange rate can remain under pressure into a potential interest rate cut and Friday's U.S. jobs report.

Pound Sterling is forecast to trade with a heavy tone into a potential interest rate cut on Thursday.

Foreign exchange analysts at Investec, the commercial and investment bank, have raised their forecast targets for the Pound to Dollar exchange rate.

The Pound to Dollar exchange rate could sail through the 1.30's in the coming months, bolstered by a more promising economic outlook and the prospects of political stability.

The Pound to Canadian Dollar exchange rate is close to three-and-a-half-year highs as the Bank of Canada looks to cut interest rates again this week.

Should global investor sentiment deteriorate further in the coming days, there is a good chance that GBP/AUD will make a run for 2024 highs at 1.9570.

Pound Sterling hit highs above 1.30 against the Dollar last week, but a decline in stock markets brought the rally to a halt. This week, we will watch the market's reaction to U.S. political developments for guidance.

Pound Sterling has turned lower again following a strong run and we forecast the pullback to extend in the coming days if equity markets continue to struggle. Eurozone and UK PMIs are the week's focus.

GBP/CAD has rallied to a new three-and-a-half-year high at 1.7720, but the odds of a pullback in the coming days are high with inflation figures due either side of the Atlantic.

The Pound to New Zealand Dollar exchange rate can deliver more gains in the coming week, but beware of overbought conditions and any pullback if UK wage and inflation figures undershoot midweek.

Pound Sterling has risen to its highest level in a year against the Dollar after last week's 1.35% gain. But, the rally leaves it technically overbought in the near term and exposed to weakness if this week's inflation and wage figures undershoot expectations.

The Pound to Euro exchange rate hit a new two-year high at 1.1920 on Monday, but inflation, wage and retail sales data will determine whether this hot streak extends.

Work has already begun to improve the UK's Brexit deal with the EU as the new Labour government pursues closer ties with the EU. Analysts at Barclays say this can help shrink the Pound's 'Brexit premium'.

The Pound to New Zealand Dollar exchange rate can remain supported into the midweek policy decision at the Reserve Bank of New Zealand.

The Pound to Australian Dollar exchange rate can recover to 1.91 this week.

Pound Sterling has now reached elevated levels against the U.S. Dollar and will need Thursday's U.S. inflation release to be soft if it is to break fresh ground.

MUFG Bank says the UK's political outlook contrasts favourably with developments in Europe and a strengthening economy will limit the amount of interest rate cuts the Bank of England can deliver in 2024.

The corrective selloff in the Pound to Canadian Dollar exchange rate might be coming to an end, but Canadian and U.S. job figures out at the end of the week will have the final say.