Will the Pound continue to fall from its current levels?

Last week the Pound fell to its lowest level against the Euro since May, making it a 5-month low after further downward pressure was applied to the Pound.

There had been some support for the Pound around the 1.1500 level although last week this threshold was broken with the GBP/EUR rate dropping as low as 1.1439. Despite recovering slightly from this low, the pair remain below 1.1500 so those of our readers hoping for a rebound in the Pounds fortunes will be disappointed so far.

It was worse than expected Retail Sales figures that pushed the already under pressure Pound lower, along with consumer confidence showing a decline. The UK economy continues to show signs of a decline so I think that the upcoming economic data releases will be watched even closer now.

According to the Office for National Statistics (ONS) Retail sales slowed by 0.9% in September which was much lower than the 0.2% expected and demonstrates that the cost of living crises continues to weigh on the UK public.

In terms of upcoming data, PMI figures are due for release out of the UK tomorrow which I think could be followed very closely by the markets after last week’s disappointing data.

Both Manufacturing and Services data will be released and if the services data shows a reading of less than the 49.5 expected I think we could see further falls in the Pounds value.

The next opportunity for the Bank of England to amend interest rates is in early November and there is currently an 85% probability of rates remaining on hold. I think the rhetoric from the BoE is likely to be the main driver of the GBP value as a result, as the markets will try to gauge how long the BoE will keep rates at the current elevated levels.

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