UK Housing Prices Surge: Driving Factors Explained
Market Comment: September 30, 2024
Nationwide UK Housing Prices
House prices are climbing at their fastest pace in nearly two years. Lower mortgage rates are driving up buyer demand. This is according to new data. Nationwide, one of the UK’s leading lenders, reported that the average home price rose by 3.2% in the year to September, an increase from 2.4% in August. The month-on-month jump of 0.7% marks the strongest annual growth since November 2022.
UK GDP and Current Account
In the UK, the Q2 GDP grew 0.5% quarter-on-quarter, slightly below the previous reading of 0.6%, while year-on-year growth came in at 0.7%, down from 0.9%. The Current Account balance showed a larger-than-expected deficit of £28.39B, well above the consensus of £32.2B. While the pound has seen mixed movements, these results may lead to short-term pressure on the GBP/USD pair.
China PMI
The Chinese NBS Manufacturing PMI for September came in at 49.8, slightly improving from last month’s 49.1, but still in contraction territory. The Non-Manufacturing PMI also showed a slight dip, down to 50.0 from 50.4. These figures suggest ongoing struggles in China’s industrial and services sectors. This may continue to weigh on commodity currencies like the AUD and NZD. This is given their close trading ties with China.
Currency Overview
- The EUR/USD pair is trading at 1.11652, up by 0.02% for the day and 0.49% for the week. The euro is showing solid growth over the past year, up 6.58%. Despite small day-to-day movements, the euro’s gradual appreciation reflects ongoing economic stability in the Eurozone. For live rates and analysis on the euro-dollar, check our currencycalculator.
- The GBP/USD is currently at 1.33894, increasing 0.13% today. The pound has seen consistent gains of 0.30% over the week and 1.89% this month, with a remarkable year-on-year increase of 10.78%. The stronger-than-expected UK GDP data earlier today might be supporting this upward momentum. Stay on top of GBP movements with our FX tool.
- The AUD/USD pair has risen 0.43% to 0.69312 today. Weekly gains are at 1.44%, and the Australian dollar has gained 2.12% this month. Australia’s strong performance against the USD could be linked to improvements in China’s PMI data. This is given the close economic ties between the two nations. Track real-time AUD/USD updates with our currency calculator.
- The NZD/USD is up 0.41%, trading at 0.63659. It’s gained 1.59% over the week, with a solid 2.19% rise this month. Like the Aussie, the Kiwi dollar has benefited from improving Chinese data, as well as general market optimism. For the latest on NZD/USD, check out our FX tool.
- The USD/JPY pair has dipped 0.15% to 141.989. The yen has strengthened by 1.15% over the week, and 3.25% over the month, reflecting a pullback in the dollar’s recent strength. Year-on-year, the yen has gained 5.25%, signaling growing investor interest in the yen as Japan’s inflation cools. For up-to-date USD/JPY rates, use our currency calculator.
- The USD/CNY pair is trading at 6.99659, up 0.23% today but down 0.89% over the week. The Chinese yuan has lost 1.68% this month, with a year-on-year drop of 4.44%. Given China’s PMI staying below 50, this could be contributing to ongoing yuan weakness. Stay informed on USD/CNY with our live FX calculator.
- Finally, the USD/CHF pair is at 0.84169, up 0.15% today but down 0.67% over the past week. Over the year, the Swiss franc has strengthened by a substantial 8.33% against the dollar, reflecting its role as a safe-haven currency. Follow live USD/CHF updates with our currency tool.
Key Data to Watch
Later today, the market will be keeping an eye on:
- EUR Consumer Price Index (CPI) for September (preliminary),
- Fed Chair Powell’s Speech at 17:00 for guidance on U.S. monetary policy,
- Chicago PMI and Dallas Fed Manufacturing Business Index in the U.S.
For updated currency rates and real-time analysis, use our currency calculator to stay ahead of the markets.