Sterling depreciated by 0.7% against the US dollar yesterday, hitting the lowest level since mid-July but gained slightly against the euro. The UK Purchasing manager’s index came in lower than expected indicating orders for materials are likely to be low this month. Although this figure may not seem important initially, it has in the past been seen to match the growth/ decline of the UK economy so it is good to keep an eye on it. A stalling UK economy seems to be of growing concern and speculation over further quantitative easing has returned once again. As long as investors continue to suspect this, sterling will be held back. Out on Wednesday there are figures for industrial production which measure productivity in UK factories and mines. Call in now for a quote.

In the Euro zone, the euro had a turbulent day falling to a one month low against the US dollar as Italian and Greek fiscal issues continue to grow.
Euro zone retail figures remained the same and came in as expected, a good sign as the Euro zone is in need of stable household consumption to recover. However, European stocks fell after an unexpected decrease in support for Angela Merkel’s party, demonstrating the German public’s discontent of having to contribute to euro zone bailouts. Out today are GDP figures, this may cause significant volatility so call in for a quote.

The US dollar had a relatively stable day versus the euro and sterling as demand for safe haven currencies increased. Despite this, a report showed that the US dollar had weakened by 11% against a basket of nine major currencies. Concerns over the US entering another recession is still a probing issue for investors, particularly after Friday’s abysmal unemployment data. Investors await Thursday’s conference between President Obama and Congress as they are expected to put forth new proposals for US job growth. Call in now for a rate.

Elsewhere, the South African rand fell to its lowest in a week against the US dollar. The Australian and New Zealand dollar also fell against the US dollar by 1%. Out on Wednesday there is Australian GDP figures and Japan’s interest rate decision. This may cause significant movement so call in now for a quote.

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