Sterling strengthened against the euro on Friday, breaking above €1.16/£1 as the ECB converted several billion euros into sterling for this year’s Single Farm Payment. The euro zone crisis was a key driver of currency exchange last week and as a result of risk averse buying, sterling fell against the US dollar leaving the pound currently trading in the $1.55/£1 range. There is a wide array of data for the UK today including manufacturing activity data (which is expected to show contraction) and also Chancellor George Osborne speaks at the Conservative party conference. Later in the week the Bank of England meets to discuss interest rates. For the first time in a while there is a real chance that we may see further Quantitative Easing to give the economy a boost. Call in now for a live exchange rate.

Over the weekend in the euro zone the Greek government approved additional austerity measures for €6.6bn but confirmed that its 2011 deficit target of 7.6% GDP is likely to be missed. In addition, the German government ratified the recent decision on the European Financial Stability Fund. Whilst Greece’s announcement is likely to cause concern in the markets, many feel that Greece will still receive the next tranche of bailout funds in the coming days. Ensure you don’t lose out due to poor exchange rates and speak to one of the traders now.

In the USA, the US dollar had a strong day on Friday as it benefited from safe haven demand – i.e. investors look to the safest currency to avoid losing their money. This risk aversion was driven by concerns over the euro zone, but more so by potentially weak manufacturing data from China. With so many relying on China to drive the global economic recovery, faltering growth and soaring inflation in the country is causing concern. There is US manufacturing figures out later today so call in now for a quote.

Elsewhere, Polish authorities intervened last week in the currency markets after the Polish zloty fell to a 27 month low against the euro. This demonstrates the level to which authorities are concerned over the level of growth. Call in now to discuss your exchange rate strategy.

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