Sterling
It was once more a disappointing day for sterling on Friday, losing further ground against most major currencies as weaker than forecast key retail sales data heaped further pressure on the already fragile UK economy. One of the biggest moves of the day came against the US dollar, where sterling fell to its weakest level since mid-November, before gaining support just above 1.5850 in the late afternoon whist challenging the 1.1900 mark against the euro. The British currency also saw a steep decline versus the Indian rupee, falling almost 2 per cent to the lowest level since early December. Speculation surrounding Britain's continued involvement in the 27-nation European Union was also rife, as excerpts released from David Cameron's delayed speech suggest a referendum is increasingly likely. With no date yet confirmed for the speech, investors will be keeping a close eye on sterling, with any loosening of the UK-EU relationship likely to further dampen confidence in the currency. This week sees a host of data released from the UK, with key focus on the Monetary Policy Committee meeting minutes on Wednesday, before Friday sees the release of preliminary GDP data; forecast to show the economy is likely to have contracted in the 4th quarter of 2012. Call in now to see how this affects sterling and to get a live price from your trader.
On Friday, the euro finished the week with a fall versus the US dollar, whilst pushing to fresh highs against sterling. The euro stabilised against the US dollar to a level from the previous day after a member of the European Central Bank Executive Board commented about how he expects that the banks repayments of funds would result in a rise of short-term interest rates. This week the markets will focus on the Eurogroup and the Economic and Financial Affairs Council (ECOFIN) meeting taking place on Monday And Tuesday where finance ministers all meet to discuss the state of Europe and the Eurozone in general. Any leaked information can cause a great deal of volatility. We also have a raft of data out of Europe with Euro-are wide services and manufacturing Purchasing Managers' Index (PMI) data released. We also have an indicator of economic health in Germany being leased on Friday as the Institute for Economic Research will give out its monthly report on current business conditions and expectations for the next 6 months. Call in now to for an up to data market information.
The US dollar strengthened against sterling and the euro on Friday, finishing on 1.586 and 1.331 respectfully, this was in spite there being poor consumer sentiment data being released. Due to the national bank holiday the US dollar is set to have a slow start to the week; however, with a variety of data set to be released later in the week, we could see a lot of movement for the US dollar. Therefore, data to look out for is Tuesday's Homes Sales data, Thursday's weekly unemployment claims and data upon New Homes Sales coming out Friday. To find out the state of the US dollar and for a live market quote, call your trader now.
Worldwide
Elsewhere, the focus this week remains on Japan. The long anticipated first Bank of Japan meeting of the new Prime Minister Abe's term finally begins today, with dramatic monetary easing expected to be implemented shortly, the Japanese yen was trading at around 90 at the end of last week so we could see a considerable shift if achieved. The Russian dubbed "currency war" will begin to come to the fore this week, as the Thai baht hit a 17 month high last week, and central bankers have raised the idea of acting to remedy the situation. The Swiss national bank may look to influence the value of the Swiss franc against the euro after it dropped through the 1.25 mark, saying that this should be set as the new low cap, and defended at all costs. It is also a busy week for Canada with retail sales and the interest rate decision from the Bank of Canada. For more news, and up to the second pricing, call in to your trader.
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