Last week proved a very good week for the Pound. Good economic figures, and the possibility of an interest rate rise, made Sterling spiral higher against both the USD, and the Euro. In fact both have hit the recent highs. However, even though this has happened, and was pretty unexpected, a bullish trend has not yet been formed.
English & Spanish
Overall the Pound still looks a little weak, and although this latest up move has dampened the enthusiasm of those predicting parity, there is stillroom for Sterling to move lower. As always the timeframe for this is the difficult thing to predict, but don’t get too excited about the Pound’s newfound dizziness!
In the short term we may see better levels, against the USD especially, but overall be careful not to get too carried away. Also, there is the interest rate question. The Bank of England has said that it will be made when they feel that the economy needs it. What they said was no different last week; they just hinted a rate rise might come sooner rather than later. This has been said before, and then changed when economic figures were not that great.
This week will not be easy to call levels. If we do get to mid 1.14s then this is a good sell area if you want to buy currency. Although overall there is a bearish tone still to the Pound; this up move has changed opinion a little. However, one thing to guard against is the uncertainty of BREXIT, much of which is still to come, and no one really knows what that outcome will be!
Watch the levels and have a good week!!!
The Premier FX Team
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This article was updated on the 13th of September, 2017.