Sterling
Sterling, had a mixed day yesterday, starting off on the front foot by making gains against the majority of its trading partners before losing ground in the afternoon. Data released yesterday showed the first revision to the UK’s fourth quarter GDP figures which fleshed out the details of the 0.3% contraction seen during that period – with exports and imports both falling sharply. Sterling also enjoyed a temporary lift after one of Monetary Policy Committee (MPC) members from the Bank of England (BoE) quashed the idea of negative interest rates being introduced. With little data expected to be released from the UK today, the markets will most likely look elsewhere for influence. Call now for the latest updates on sterling.
Euro
Bond traders were clearly unfazed by news that the Italian comedian-turned-politician Beppe Grillo had rejected calls from the leader of the country's democratic party to form a coalition majority, as Italy achieved its target in yesterday's bond auctions. The euro was spurred by the news, as well as a report showing that economic confidence had improved last month, to gain against the dollar for the first day in three. Last night heard the President of the European Central Bank once again talking up the state of the Eurozone, saying that "we should build a strong and deep economic union in Europe"; whilst, at the same time stating that the ECB is far from exiting from stimulus measures. Today sees the release of both German and Eurozone Consumer Price Index data as well as consumer spending and employment releases, key fundamentals which will either support, or highlight the weakness in recent statements. Get in touch now for the latest news and rates.
US dollar
The US dollar had a mixed day yesterday struggling in the morning but regained some of its losses in the afternoon. Positive Core Durable Goods Orders, rising by the highest rate in a year, and Pending Home Sales data both came out much better than expected. In his testimony the Federal Chairman suggested the benefits outweighed the negative with regards to the central bank's asset purchasing program. The testimony gave no signs that the Fed may slow or even stop monetary easing, in spite of recent murmurings that the central bank may look to taper asset purchases. The Chairman also maintained pressure on Congress to act to prevent the USD 1.2 trillion of spending cuts that are due to start taking effect from March 1st reminding the Committee of the Congressional Budget Office’s forecast that US growth will be adversely affected by around -0.6% this year, and the labour market will lose 750k jobs, if the spending cuts are maintained throughout the whole year. Today we have Preliminary fourth quarter GDP data – expected to show 0.5% annualised growth - and the weekly unemployment claims coming out of the states. Call in now for the latest news and live rates.
Worldwide
Elsewhere, the Japanese yen was the stand out performer yesterday as risk aversion dominated the market due to political uncertainty in Italy. The Australian dollar struggled yesterday after worse than expected construction data was released whilst the commodity backed currencies struggled in general. Overnight we saw the release of business confidence figures from New Zealand whilst we saw a raft of data out of Australia including figures showing the change in the level of new capital expenditures made by private businesses. Later on today we have inflation data and current account figures from Canada. Call in now for a market update and a live quote.
Sterling
Sterling had a mixed day yesterday – starting off on the front foot reaching highs of 1.1650 against the euro and 1.5220 against the US dollar before losing ground later in the day. Sterling struggled after one of the Monetary Policy Committee (MPC) members from the Bank of England (BoE) suggested he was open to more monetary easing and furthermore, that the prospect of negative interest rates had been raised at central bank meetings. Furthermore, realised sales data from the Confederation of British Industry (CBI) came out lower than expected. Out today we have the second estimate of the UK's fourth quarter GDP which is expected to show a contraction of 0.3%, the same as the first estimate. Moreover, more MPC members will be speaking today, and following yesterday’s volatility, the market will pay close attention to what they have to say. Call now for the latest updates on sterling.
Euro
It has been a turbulent few days for the euro, news of the inconclusive Italian election yesterday drove the euro to a seven week low against the dollar – whilst weakening by three cents against sterling. The damage was not as widespread as first feared however, as traders became confident that the European Central Bank (ECB) would intervene to limit the fallout, and the euro strengthened in the afternoon. Today is likely to be just as volatile with two important events. Firstly, we expect an Italian 10 Year Bond auction this morning - a key way for governments to borrow money and high yields mean high borrowing costs for the Italian Government. Secondly, in the afternoon the ECB President is speaking in Germany, we traditionally see a great deal of volatility during his speeches as markets look for hints as to future monetary policy. Get in touch now for the latest news and rates.
US dollar
The US dollar generally performed well yesterday, strengthening against the majority of its currency partners with Consumer Confidence figures and New Home Sales data (rising in January to the highest since 2008) both coming out much better than expected. Along with this, the Federal Reserve Chairman backed the central bank's current stimulus program, saying that they will support the asset purchases with "little risk of inflation or asset-price bubbles" causing the dollar to strengthen further. In the testimony he stated that "We do not see the potential costs of the increased risk-taking in some financial markets as outweighing the benefits of promoting a stronger economic recovery." Although he also warned that the automatic federal budget cuts in line to begin 1st of March will add a "significant" burden to the economy if lawmakers are unable to avert from the reductions. Today we will see Core Durable Goods orders along with the second part of the Chairman of the Federal Bank’s "congressional testimony" on monetary policy.
Worldwide
Elsewhere, the Canadian dollar fell to a eight month low versus the US dollar following better than expected data out of the US and the comments from the Chairman of the Federal Bank. The commodity backed currencies struggled in general yesterday whilst the Japanese yen prospered due to risk aversion driving the markets and traders seeking safer havens for their money. The Russian rouble was one of the worst performers yesterday after GDP data released showed that the economy had contracted by 0.3%. Call in now for a market update and a live quote.
Sterling
Yesterday was not for the faint hearted as the currency markets twisted one way and then the other as the news flow gathered pace. Sterling was aggressively sold off in early trading yesterday, reaching a sixteen month low against the euro and a 2.5 year low against the US dollar following Moody’s - one of big three credit rating agencies - downgrading the UK’s sovereign rating by one grade to Aa1 from Aaa. The bond markets appeared to pay little attention to the news, with yields on UK government debt little affected by the news. Weaker than expected mortgage approvals data did little to help sterling early on. However, sterling has staged a recovery, albeit I suspect short term one, in the late afternoon reaching as news of a hung parliament in Italy undermined the euro. Chancellor George Osborne spoke yesterday and confirmed that the government would not deviate from its current path in spite of the recent downgrade. Early this morning the Governor of the Bank of England will be speaking and later on today we also have the realised sales data from the Confederation of British Industry (CBI)and a report from the Governor of the BoE and its Monetary Policy Committee (MPC) members on inflation and the current economic outlook. Call now for the latest updates on sterling.
Euro
The euro had a mixed day yesterday reaching a 16 month high against sterling in the morning, as well as making significant gains versus the US dollar before a sharp sell-off in the afternoon. The euro performed well in early trading as there was a confidence in the market that the centre-left leader Bersani (the frontrunner) would win an outright victory. This confidence disappeared as figures began to show that Silvio Berlusconi may have built a up enough support to deny Bersani outright victory - which triggered speculation of another election and the euro was sold off across the board. European policy makers gave an improved outlook for the region with the European Union Economic and Monetary Affairs Commissioner talking down the risks around the region and saying that "reforms are starting to pay off, deficits are declining and Europe will gradually return to growth". However, the CESifo (an economic research group in Europe) warned that further austerity "will dampen economic activity in almost all member States" as well as stating that "domestic demand looks set to shrink further in 2013" due to high unemployment. This unemployment along with a number of poor developments may encourage the European Central Bank (ECB) to lower interest rates, which will force the Governing council to carry out its easing cycle across 2013 with this economic downturn causing price instability. We have a quiet day today in terms of data coming out of Europe; but, expect further aggressive movements in the markets once the final result from the Italian election is announced. We also have a speech a from the ECB President today, as well as an Italian bond auction. Call now for the latest news and live rates.
US dollar
The US dollar had relatively strong day all round yesterday strengthening against most of its major currency partners as risk aversion dominated the markets due to fears over the Italian parliamentary election. The Chairman of the Federal Reserve, Ben Bernanke is due to feedback on the current monetary policy today and analysts expect the Chairman to outline his support for the current stimulus program. There will also be new residential sales data and consumer confidence figures. With a host of data released today, we could see a significant effect on the US currency, so call in now or a market update and a live quote.
Worldwide
Elsewhere, the Japanese yen was in the headlines once again due to rumours that the prime minister is close to nominating Mr Karudo as the next governor of the Bank of Japan. The yen dropped to a 3 year low against the US dollar following this announcement as Mr Karodu is a man who has clearly stated his willingness to increase monetary stimulus if necessary. Worse than expected Chinese manufacturing PMI released early on Monday caused commodity backed currencies to struggle. The Indian rupee has risen 1.5% year-to-date, starting the year on a strong footing following steps taken by the Indian government to manage its ‘twin’ deficits. The next catalyst for the rupee should be the Indian budget announcement later this week. In all likelihood, it is going to be the most austere budget in recent years as the focus of the government remains on managing its fiscal as well as current account deficit and reviving investment flows into the country. Call in now for a market update and a live quote.
Sterling
Late on Friday, the UK lost its top credit rating from Moody’s, one of three credit rating agencies, who downgraded the UK debt by one grade to Aa1 from Aaa. This was not unexpected and is due to the bleak outlook for the nations growth and it was also noted by Moody's that there are significant challenges that the government faces in trying to reduce public debt. Whilst a downgrade had been anticipated by many economists for some time, it still sent shockwaves through the market causing sterling to drop against all of its major trading peers bar the Japanese yen. Sterling had started Friday on the front foot reaching 1.1617 against the euro and 1.5310 against the US dollar before dropping off in the afternoon following comments from one of the members of the Monetary Policy Committee (MPC) who was urging for another round of quantitative easing. Perhaps the most influential release this week is the second estimate of the UK's fourth quarter GDP which is expected to show a contraction of 0.3%. Other data released this week includes realised sales data from the Confederation of British Industry (CBI) and the Manufacturing Purchasing Managers' Index (PMI) data which will be released on Friday plus several members from the MPC will be speaking this week. Call now for the latest updates on sterling.
Euro
The euro had a mixed day on Friday after better than expected German sentiment data helped support the euro as the markets hope this implies that the European powerhouse wont slip into recession. This positivity is in spite of figures released showing that the final reading for the last quarter German GDP showed a contraction of 0.6%. The downbeat EU economic forecast for the next two years prevented a euro rally as growth forecasts were downgraded significantly for both France and Germany, whilst predicting the Eurozone as a whole to contract by 0.3% in 2013. Furthermore, the news that banks were only repaying €61 billion from an expected €122 billion in the ECB's LTRO repayment caused the euro to drop to a six week low against the US dollar. The Italian elections continue today and the markets remain nervous in anticipation of the result especially if former Prime Minister Silvio Berlusconi should win enough votes to achieve a hung parliament as political uncertainty would return and could unsettle the euro. Other data released this week includes manufacturing PMI, inflation data and unemployment data from Germany, whilst the President of the ECB is also speaking. Get the latest rate by calling us now.
US dollar
The US dollar traded somewhat on the sidelines on Friday as news from the UK and Europe dominated the headlines. There is a raft of data out of the US this week which includes consumer confidence statistics, preliminary GDP figures which are expected to show modest growth of 0.5% for the fourth quarter of 2012, manufacturing PMI and the Chairman of the Federal Bank is speaking on several occasions. With so much data and commentary out of the US this week there is the possibility for a lot of volatility, call in now or a market update and a live quote.
Worldwide
Elsewhere, the Australian dollar performed well on Friday following comments from the Governor of the Reserve Bank of Australia who indicated that another interest rate cut was less likely. The Canadian dollar struggled on Friday, dropping to a seven month low against the US dollar after extremely poor retail sales data was released in conjunction with lower than expected inflation data. Chinese manufacturing PMI data was released early this morning and later on this week we have business confidence figure from New Zealand, private businesses expenditure in Australia, more manufacturing PMI data from China and GDP figures from Canada. Call in now for a market update and a live quote.
Sterling
After another poor week for sterling dropping against all of its major counter parts and falling at one stage to a 15 month low against the euro and an 30 month low against the US dollar. The Bank of England (BOE) minutes revealed that three members on the Monetary Policy Committee (MPC), including the Governor of the BOE, voted for expanding the current levels of quantitative easing plus there had also been discussions about potentially cutting interest rates. More negativity was evident on Tuesday when rumours spread of a potential downgrade for the UK’s gold plated AAA credit rating. Whilst the overall unemployment rate did reach 7.8% in January, there are definite signs that the labour market is starting to recover. Employment reached an all-time record of 29.73 million in the last quarter of 2012 and the number of new people claiming unemployment related benefits dropped by more than expected. Sterling started to recover some of its losses yesterday as more positivity came when the Public Sector Net Borrowing figures came in better than expected with a surplus in January of £11.4bn (the largest in 5 years) and Industrial Order Expectations from Confederation of British Industry (CBI) were better than initially anticipated. With no significant data expected to be released today, you might expect a stable day for sterling; however, recent activity tells us how volatile and how unpredictable the markets can be, so call in today for the latest updates on sterling.
Euro
The euro has had a mixed week, starting off on the front foot following comments from an ECB Governing Council member and the German Chancellor who said that there was no need to intervene to weaken the euro as it was in a normal range. The six month economic sentiment surveys for Germany and the Eurozone were much better than expected with the German figures reaching a three year high. Yesterday we saw some unexpectedly poor manufacturing and services Purchasing Managers' Index (PMI) data across Europe which caused the euro to fall against the majority of its major currency pairs. Traders eyes will now be geared firmly towards the Italian elections this weekend. Should former Prime Minister Silvio Berlusconi win enough votes to achieve a hung parliament, political uncertainty will return and this could unsettle the euro. The euro remains in a strong position against sterling in particular, but today will see the release of German business climate data and a EU economic forecast for the next 2 years for the Eurozone's member states. Both sets of important information which will inevitably have a heavy influence on the euro. Get in touch now for the latest news and an up to the second quote.
US dollar
The US dollar started off quietly this week, trading in fairly a narrow range due to lack of data released in the states and the markets being closed for Presidents' Day. However, it made strong gains later in the week reaching a 30 month high against sterling and a one month high against the euro following the release of the latest Federal Open Market Committees (FOMC) meeting minutes. The minutes outlined that the Federal Bank should be prepared to vary the pace of quantitative easing, thus normalising monetary policy – a sign that the central bank is looking at tightening monetary policy going forwards. The minutes however, didn't indicate as to when quantitative easing may end. Yesterday we saw the release of core Consumer Price Index data (CPI) and existing home sales data which came out better than expected. It wasn't all positive as the weekly unemployment claims and the Philly Fed Manufacturing Index came out worse than forecast. We have a quiet day in the states today although one of the members of the FOMC is speaking in the afternoon. Call now for the latest news and updates.
Worldwide
Elsewhere, the New Zealand dollar was one of the worst performer this week following comments from the Governor of the Reserve Bank of New Zealand (RBNZ) who suggested that the central bank may look to intervene if the New Zealand dollar’s current strength persists. The Japanese yen had a mixed week after the G20 failed to single out Japan for its recent policies which have promoted yen weakness; but, comments from the finance minister who rejected the prime ministers idea of buying overseas bonds saw the yen rally. The Turkish lira struggled after the central bank cut interest rates by 0.25%. The Australian dollar performed fairly well following the minutes from the most recent monetary policy meeting indicating that another interest rate cut was less likely. Out today we have inflation data and retail sales data from Canada, so call in now for a market update and a live quote.
Sterling
The bad news keep on coming as sterling fell sharply yesterday, dropping to a 15 month low against the euro and its lowest since June 2013 against the US dollar. This happened after the Bank of England (BOE) minutes showed that three members on the Monetary Policy Committee (MPC) voted for expanding the current levels of quantitative easing. Furthermore the minutes revealed that there had been discussions about potentially cutting interest rates; although all members voted against a cut in interest rates. Unemployment data came out with a mixed signals. The number of people claiming unemployment benefits dropped by more than expected, but the jobless rate came out worse than predicted with a unemployment rate now reaching 7.8% in January. Out today we have the latest figures on Public Sector Net Borrowing and Industrial Order Expectations from Confederation of British Industry (CBI). Plenty of scope for further bad news for sterling. Not that long ago we were wondering if sterling would fall below 1.20 against the euro - under 1.14 seems very likely now! Call in today for the latest news and a live rates from our traders.
Euro
A mixed bag for the euro yesterday particularly in the shadow of the US dollar's very strong performance. The euro reached a 15 month high against sterling following the minutes from the most recent monetary policy meeting in the UK but struggled against most of its' other major currency partners. The German Chancellor’s statement that a EUR/USD rate between 1.30 and 1.40 was 'normal' gave some confidence in the market that the euro was not overbought. The markets will also be looking at Eurozone political developments this week, with a general election in Italy on the 24th-25th February and with Cyprus also probably heading to a second round of Presidential voting on the 24th as well. While the markets are probably assuming victories for pro-reform parties and/or coalitions, the potential remains for surprises, in Italy in particular. Should former Prime Minister Silvio Berlusconi win enough votes to achieve a hung parliament, political uncertainty will return in Italy and may dampen euro sentiment. Get in touch now for the latest news and an up to the second quote.
US dollar
The US dollar performed extremely well yesterday reaching fresh eight month highs against sterling. Poor inflation data from the US as well as declining housing starts promoted risk aversion in the global markets. Other data released yesterday showed that building permits increased at their quickest pace since June 2008. Yesterday evening we saw further dollar strength following the release of the latest Federal Open Market Committees (FOMC) meeting minutes. The minutes outlined that the Federal Bank should be prepared to vary the pace of quantitative easing, thus normalising monetary policy – a sign that the central bank is looking at tightening monetary policy going forwards. Today we see the release of core Consumer Price Index data (CPI), weekly unemployment claims figures, existing home sales data and the Philly Fed Manufacturing Index being released in the US. Call now for the latest news and updates.
Worldwide
Elsewhere, the New Zealand dollar was the worst performer out of the major currencies yesterday following comments from the Governor of the Reserve Bank of New Zealand (RBNZ) who suggested that the central bank may look to intervene if the New Zealand dollar’s current strength persists. Another combatant for the currency war. The Swedish krona performed relatively well yesterday, reaching a 20 year high against sterling! There is little data expected to be released today, but, the Governor of the Reserve Bank of Australia (RBA) is speaking late this evening. Call in now for a market update and a live quote.
Sterling
Yesterday sterling continued on its downward trend, weakening to a seven month low against the US dollar and pushing close to a thirteen month low against the euro, which we reached at the beginning of the month. Negative sterling sentiment continues to rise. Markets are waiting for this morning's release of the Bank of England's (BOE) minutes of its February meeting and rumours of a potential downgrade for the UK’s gold plated AAA credit rating have increased. We also have the release of unemployment data today, with the overall rate of unemployment expected to remain the same at 7.7%, whilst analysts expect an improvement in the number of new people applying for unemployment related benefits. The most eagerly anticipated part of the BOE's minutes tends to be the breakdown of the members' votes – market expectation is that all nine members voted against a change in interest rates and the current level of quantitative easing. Any difference from expectation could be negative for sterling. Call in today for the latest news and up to second price.
Euro
The euro had a mixed day yesterday, performing relatively well following the release of better than expected economic sentiment surveys which look at the relative six month economic outlook for Germany and the Eurozone as a whole. The German figures came out at a three year high which helped boost demand for the single currency as the market notes an increase in confidence for the region’s economic powerhouse. It is a fairly quiet day in Europe today with only inflation data from Germany and France of note on the economic calendar. Worries about the outcome of this coming weekends Italian election are beginning to undermine the euro - markets dislike uncertainty. Get in touch now for the latest news and an up to the second quote.
US dollar
The US dollar was generally weak yesterday, seemingly due to an increase in global risk appetite rather than poor data out of the States. Today we have inflation data, building permits figures and perhaps more importantly the Federal Open Market Committee (FOMC) monetary policy meeting minutes released late this evening. This will be a major influencing factor and sure to have an impact on the markets as traders looks for clues as to when the central bank will look to tighten monetary policy or perhaps loosen it further still. Looking forwards, there is little more than a week until the "sequester" spending cuts in the US are automatically triggered which some fear could cause another economic downturn and perhaps push the US to fall back into recession. Call in now for the latest news and live rates.
Worldwide
Elsewhere, the Turkish lira was the worst performer yesterday after the central bank cut interest rates by 0.25% whilst the Canadian dollar continued to struggle. The Japanese yen performed well yesterday following the comments from the finance minister who rejected the prime ministers idea of buying overseas bonds. The Australian dollar performed fairly well following the minutes from the most recent monetary policy meeting being released which indicated another interest rate cut was less likely –whilst noting that the recent cut had helped boost the economy. Late last night we saw the Governor of the Reserve Bank of New Zealand (RBNZ) speaking and later on today we have economic sentiment surveys from Switzerland. Call in now for a market update and a live quote.
Sterling
Yesterday was a poor day for sterling, we saw a sharp drop in the morning against most of its major peers - reaching a seven-month low against the US dollar. The Bank of England has if anything come the closest of all central banks to acknowledging that a weak pound is part of their overall strategy for recovery and this was reinforced yesterday when one of the members said that sterling might need to weaken further still. Data released showing the change in the asking price of homes for sale was higher than expected helped support sterling, but not enough to regain all the losses from earlier. With little data out today we don't expect to see large swings in sterling's exchange rates, but sterling remains vulnerable due to the fragile state of the British economy so call in now for the latest news and live prices.
Euro
The euro had a fairly positive day yesterday following comments from the ECB’s Governing Council member who said that there was no need to intervene to weaken the euro and that it was in a “normal range” whilst the President of the European Central Bank highlighted that the exchange rate was not a policy target and that inflation was in line with expectations. Out today we have an economic sentiment survey which looks at the relative 6-month economic outlook for Germany and the Eurozone as a whole. Get in touch now for the latest news and an up to the second quote.
US dollar
The US dollar traded in a fairly narrow range yesterday which was down to the US markets being closed for Presidents' Day and therefore trading volumes were low. It is also very quiet in terms of data coming out of the US today with focus given to the economic sentiment figures released in Europe. All eyes will be on tomorrows Federal Open Market Committee (FOMC) monetary policy meeting minutes as it will be the major influencing factor, as well as inflation data and building permits which are also set to be released. Call in now for the latest update on the US dollars movements.
Worldwide
Elsewhere, the Canadian dollar struggled once more in spite of positive comments from Canadian central bank governor as traders view his sentiment as over optimistic. Today see's the release of foreign securities purchasing data and wholesale trade data. Hopefully there will be positive news for the Canadian economy. Further violence took place at South African mines today which resulted in the South African rand weakening as investors remembered last year's mining problems. The Japanese yen also continues to weaken due to the G20 failing to single out Japan for its recent policies which have promoted yen weakness, and as such it is unlikely to make much difference to the trend of yen depreciation. The minutes from the most recent monetary policy meetings in both Australia and Japan were released overnight and later on this evening we have inflation data out of New Zealand. Call in now for a market update and a live quote.
Sterling
Sterling performed relatively well on Friday, in spite of a sharp drop on very poor retail sales data released in the morning, it pared back all the losses to make gains across the board. The retails figures showed that the recent Christmas sales period was the second worst over the past fifteen years. The big story this week will be the release of the minutes from last week's Monetary Policy Committee meeting on Wednesday; the key question being whether the nine members remain unanimous in holding interest rates and asset purchasing as is. Last week the Governor of the Bank of England said that if necessary more will be done, but that monetary policy is not a panacea and has limits to its efficacy. The ground may have been prepared, therefore, for some disparity of opinion - if we do see some, expect markets to react taking a position ahead of possible future changes. Get in touch now for the latest news and prices.
Euro
This week should be a volatile one for the euro, with influential data released on most days. However, if recent trends are anything to go by, it is output from the central bank that influences exchange rates more than anything at the moment so the President of the European Central Bank speech today will set the tone for the week. Last time he spoke he was unusually negative about the outlook for the Eurozone, and with a swathe of poor data out last week he seems likely to continue on that theme. With markets seemingly waiting on his every word, if the theme does continue, expect the euro to weaken. Later in the week, an economic sentiment survey and detailed manufacturing data are released from Germany. Given the poor GDP data last week, it would seem likely that these could disappoint which would be negative for the euro. Get in touch now for the latest news and an up to the second quote.
US dollar
In the US on Friday, the empire state manufacturing index came out much better than expected and consumer sentiment figures also beat expectations. It is a bank holiday in the US today in observance of Presidents' Day, so you can expect liquidity to be thinner than usual during US trading hours. There is a raft of important data released later this week, this include the minutes from the most recent monetary policy meeting from the Federal Open Market Committee (FOMC), two sets of key inflation data and we will also see more manufacturing data released. Call in now for the latest update on the US dollars movements.
Worldwide
Elsewhere, the G-20 meeting in Moscow was the talk of traders on Friday following recent comments about supposed 'currency wars'. One direct effect of the meeting saw the Japanese yen continue to fall against the US dollar. In the closing statement after the meeting the finance ministers said that "G-20 countries have always held the position that currency policy should be based on market conditions"; however, the issue will always be a grey area when central banks decide to increase the level of monetary easing. Canada saw some unimpressive manufacturing data released which caused the Canadian dollar to weaken off, the Swedish Krona also weakened against most of its major partners; but, the New Zealand dollar performed well after impressive retail sales figures were released. This week we have the minutes from the most recent monetary policy meetings in both Australia and Japan; furthermore, from Canada we will see the release of key inflation data alongside retail sales figures. Call in now for a market update and a live quote.
Sterling
After a stronger performance last week, sterling has struggled over the past few days - continuing on its recent run of form, weakening against the majority of its major trading partners including dropping to a fresh 6 month low against the US dollar. Sterling recovered slightly against the euro on Thursday following the news that the euro-area recession has deepened, erasing hopes that the EU economy is headed in the right direction. This week started with a report which showed that business confidence in the UK had hit a record low and Consumer Price Index (CPI) data came out as expected with a 2.7% increase. Sterling was sold off sharply on Wednesday following the comments from the Governor of the Bank of England where he suggested the UK faced "big challenges" ahead. Moreover, the Confederation of British Industry (CBI) lowered its growth forecasts for 2013 from 1.4% to 1%. Today sees the release of Retail Sales data, a primary gauge of consumer spending and one hopes this release will bring us some positive news - current projections are suggesting growth of 0.5%. Get in touch for an up to the second price, and more news.
Euro
It has been a mixed week for the euro this week. The early part of the week saw somewhat unjustified confidence in the Eurozone benefit the euro, but yesterday saw the rug pulled from underneath it. A whole swathe of data releases, including GDP data from the French and German core of Europe, came in below even pessimistic forecasts. The poor fundamentals highlighted how unjustified the recent strength in the euro has been, and it came crashing down to a 3 week low against the dollar. However, continued weakness in sterling meant the euro remained fairly flat against sterling trading in the 1.16 range for most of the day. Today the G20 talks start in Moscow with the "currency war" on top of the agenda, so expect the PR to begin again, whether markets react to it this as strongly as they have done in recent times remains to be seen. Get in touch now for the latest news and quotes.
US dollar
The US dollar has had a poor start to the week following comments from the Federal banks Vice-Chairwoman who said that the central bank will use "forceful action to increase the pace of economic growth and job creation." That being said, the US dollar has performed well against sterling and the euro reaching a 6 week and 3 week high respectively. President Obama's speech late on Tuesday night included plans to use $1 billion to create 14 manufacturing institutes, change the tax code which benefits companies that expand in the US and create a trade deal with the EU. Retail figures emerged with no surprises though showing the expected steady growth of 0.1%. Today see's the release of industrial production data and perhaps more importantly consumer sentiment data which will give a good indication of the state of confidence in the US as a whole. Call in now for the latest update and a live price from the market.
Worldwide
Elsewhere, as had been the current trend of late - the Japanese yen and the Bank of Japan has stolen much of the headlines this week. Early on Thursday morning the Bank of Japan voted to leave rates unchanged as widely expected and also left the stimulus program unchanged. The G20 summit starts today and much of the focus will be on Japan following the statement mid-week from the G7 condemning the recent "currency war". The Swedish Krona rose to a four month high against the euro on Wednesday as the central bank chose to refrain from easing monetary policy, which would weaken the currency. The Hungarian forint struggled yesterday following the news that GDP had fallen by 2.7% in the fourth quarter. The New Zealand dollar performed well yesterday following the release of better than expected manufacturing data and late last night we saw the release of retails sales figures. Get in touch now for the latest news on your currency.
Sterling
Yesterday was a bad day for the UK economic outlook and a bad day for sterling. In his quarterly inflation report, the Governor of the Bank of England cut growth forecasts for the UK, saying that there are "big challenges" ahead and also hinted towards more monetary easing when he said “If necessary, we will do more.” Sterling dropped against all of its major peers by at least half a percent, broadly trading 0.7% lower than 24 hours earlier. Moreover, the Confederation of British Industry (CBI) lowered its growth forecasts for 2013 from 1.4% to 1%. In spite of this, the FTSE 100 reached a fresh 5 year highs, possibly due to foreign investors making the most of sterling’s weakness. With no releases there is unlikely to be a change in sterling's fortunes in the short term, and longer term forecasts from major banks aren't sterling positive either, so it looks as if sterling to be weak for the foreseeable future. Get in touch for an up to the second price, and more news.
Euro
The euro declined against the majority of its 16 most-traded peers early yesterday due to data coming out from the peripheral troublemaker Portugal, with the rise of the jobless rate in the country now at its highest level in the counties history. The situation changed later however, as the Euro-area's industrial production data showed a bigger increase than was forecast. This could be a sign that Europe’s recession is easing somewhat and today we will see more clues on the state of the Eurozone with Euro-area wide preliminary GDP data released. An overall contraction of 0.4% is predicted and even Germany - the Eurozone’s powerhouse - is expected to show a contraction of 0.5%. Call in now for the latest news from the Eurozone and live prices on the euro.
US dollar
The US dollar struggled yesterday, weakening against most of its major trading peers – but performed well against sterling. President Obama’s speech included plans to use $1 billion to create 14 manufacturing institutes, change the tax code which benefits companies that expand in the US and create a trade deal with the EU. Retail sales figures came out as expected showing growth of 0.1%. Out today we have the weekly unemployment claims data, a 30-year bond auction and another member from the FOMC will be speaking. Get in touch now for an up to the second price, and the latest news.
Worldwide
Elsewhere, the South African rand was, for once, an outstanding performer yesterday. Bets that the global economy was picking up saw metal prices rise, bringing key producers up with it - the rand gaining by as much as 0.6%. The Swedish Krona rose to a four month high against the euro as the central bank chose to refrain from easing monetary policy, which would weaken the currency, in spite of the Finance Minister's comments last month that the high price was harming exports. A two-year high in consumer confidence down under brought the Australian dollar up against most major peers. Today, the spotlight is on Japan and the statement from the Bank of Japan on monetary policy. After the G7's statement last week, expect traders to be listening closely, and for a huge amount of volatility. Give us a call for news on your currency, and for the best rates.
Sterling
Sterling struggled badly yesterday amid speculation that the Bank of England will cut its growth forecasts in today's Inflation Report. For the first time in 6 months the pound fell below the 1.56 mark against the dollar, and broke through 1.16 in the morning against the euro. The Bank of England is expected to say that inflation looks likely to remain above target for the foreseeable future, which hardly bodes well for a tightening of monetary policy, as a result, sterling could very well stay at least as weak as it is currently. Yesterday the Consumer Price Index data came out as expected with a 2.7% increase for the fourth consecutive month in January – inflation has remained at this high level now for the longest period since records began. Markets were little changed by the release and were more focused on speculations around today's important press conference held by Bank of England Governor upon the release of the Inflation Report. Volatility is often experienced during these speeches as observers try to solve the subtle indications regarding future monetary policy and the BOE's future interest rate decisions. Call in now for the latest news and rates.
Euro
The euro had a fairly good day yesterday, strengthening against both sterling and the US dollar. The President of the ECB’s speech to the Spanish parliament encouraged Eurozone confidence as he applauded Spain's economic progress suggesting that Spanish banks were showing positive data following a rescue plan as the country continues towards economic recovery. Not much data is due to be released today; but, with lots of data out the US there is still the potential for a lot of movement in the markets. The markets will also look ahead to the G20 summit on Friday which is set to feature detailed discussions regarding currency manipulation. Call in now to for a live market quote and further news and analysis.
US dollar
The US dollar struggled yesterday, weakening off against the vast majority of its major counterparts; but, did reach a 6 month high against sterling of 1.557 before falling back in the afternoon. The US dollar struggled following comments from the Federal banks Vice-Chairwoman who said that the central bank will use “forceful action to increase the pace of economic growth and job creation.” President Obama was speaking late last night and it will be interesting to see how the markets react following his comments today; however, it is likely that the Treasury secretary’s speech at 3pm today will cause a lot more volatility as his speech looks to communicate the US President's economic policies. There is also a raft of data out of the US today including retail sales figures, crude oil inventories and a benchmark 10-year bond auction. Call in now for the latest update and a live price from the market.
Worldwide
The big story elsewhere was, once again, the Japanese yen. The G7 released a statement condemning the recent currency war, highlighting Japan, saying that there are only losers in a fight to actively depreciate currencies. The Yen jumped 1% on the statement. After news agencies reported a successful North Korean nuclear test, appetite for riskier assets plummeted, weakening currencies like the South African rand. The Australian dollar also hit the lowest rate against the US dollar since October as traders anticipated a rate cut by the Reserve Bank of Australia. There is little in the form of influential data released today, the Bank Holiday for Chinese New Year will likely keep trading volumes low in the east so expect volatility as trades move the market more dramatically - especially as traders take positions ahead of tomorrow's anticipated Press conference and monetary policy statement in Japan. Get in touch now for the latest news on your currency.
Sterling
The currency markets at the moment are highly volatile but to describe the current state of play as a “currency war” is probably too emotive but that is the phrase that is being used in news headlines. The aim of the “currency war” is to debase your currency so that as it weakens it boosts exports and therefore economic activity at home. If that is the aim of the Cameron government they are doing a good job as Sterling lost ground against both the Euro and the US dollar yesterday. Over the last week we have seen Sterling gain nearly four cents against the Euro and yesterday lose nearly 2 cents. The trend though is very much in favour of Sterling weakness against the Euro. Yesterday Sterling suffered as a report announced that business confidence in the UK had hit a record low. Today we have the release of Consumer Price Inflation. Expectations are for no movement from last month with a rate of 2.7%, still way above the target rate of 2%, and it is very unlikely we will hit this target rate any time soon. As highlighted, volatility continues to be high, so call in now to get the latest rates and minimise your risks.
Euro
The Euro benefitted from being talked up by the head of the German Bundesbank who stated that he didn’t think the Euro was significantly overvalued and that the European Central Bank was unlikely to reduce interest rates. This will have annoyed the French who stated the contrary last week and increase the pain for those southern states of the Euro zone who need to see their economies benefit from increasing exports. Not much news out of the Euro zone today but we do have the G20 meeting this weekend so it will interesting to see what other Euro zone political pronouncements we have in the build-up. Yields on the government bonds of the southern states continue to increase. Still way below critical levels but a worry none the less. Call in now for the latest rates.
US dollar
The US has been on the side lines for the last few days being influenced by events elsewhere. It continues to be quiet on the data front today so again influences will come from elsewhere. Tomorrow we have retail sales data with expectations for a fall in January. Call in now to see how the US dollar is moving as events unfold elsewhere.
Worldwide
The main news elsewhere still centres on the Yen which continued to weaken even though the Japanese finance minister tried to talk it up by saying that it had weakened too quickly. With the G20 meeting coming up and a key item on the agenda will be the “currency wars”, it will interesting to see if the Yen can stem its losses before that meeting. The real problem is that markets know the Japanese intent is to weaken the Yen and therefore it is very difficult to reverse as investors will not want to invest in the Yen in the short to medium term.
Sterling
Sterling continued to perform well on Friday, at one stage reaching 1.58 against the US dollar and 1.1850 against the euro, following the comments from the incoming Governor of the Bank of England Mark Carney on Thursday where he suggested that the central bank would refrain from additional monetary stimulus. This week see's key inflation data released in the UK on Tuesday, the Governor of the Bank of England is speaking on Wednesday and on Friday retail sales data will also be announced. Furthermore, a two day G20 meeting starts on Friday, so any news emerging from these meetings could cause volatility in the market. Sterling performed well last week; but, the underlying fundamentals in the UK remain very poor and it is still in a downward trend against the euro which started in the middle of last year. Call in now to see how it could fair going forwards.
Euro
The euro continued to struggle on Friday despite German trade balance data released being much better than expected. The German data showed that exports have continued to increase and hit a record high in December underlining the disparity between the economy in German, Europe's powerhouse, and the rest of the Eurozone's economies as a whole. The EU leaders have now agreed the budget for 2014 to 2020 after all night talks took place in Brussels and represents a 3% cut compared to the current budget. The Eurogroup meetings continue today and tomorrow the President of the European Central Bank will be speaking. Given how influential his comments are they will be very carefully scrutinized by the market and could lead to some very rapid movements in the euro. The euro continues to be in the ascendancy against Sterling and the US dollar and it will take a change in sentiment to reverse this trend, and the ECB President is the most likely person to achieve this if he so wishes. Later on this week we have preliminary GDP data released across Europe with the overall GDP figure expected to show a 0.4% contraction. Call in now for the latest update and a live price from the market.
US dollar
The US dollar has a mixed day on Friday following the release of better than expected trade balance data which showed that the deficit was narrower than anticipated. The Chicago member of the Federal Open Market Committee (FOMC) comments late on Thursday evening reinforced the FOMC's current mandate to keep monetary policy loose until the job markets start to recover. This week a number of other members from the FOMC will be speaking and it will be interesting to hear what they say following the Chicago's member comments late last week. On the data front, this weeks releases include consumer sentiment data, the weekly report on unemployment claims and retail sales figures will also be announced. Get in touch now for an up to the second price, and the latest news.
Worldwide
Elsewhere, the Japanese yen was the stand out performer on Friday following comments from the Finance Minister suggesting that the Japanese yen's recent devaluation may have happened too quickly. The Canadian dollar struggled on Friday after worse than expected unemployment data was released. Better than expected Chinese trade balance data was released with both exports and imports increasing, helping China to overtake the US as the biggest trading nation in the world. Chinese and Honk Kong markets are shut for much of this week in accordance with the Chinese New Year celebrations and Japanese markets are shut today in accordance with the National Foundation Day bank holiday so you can expect low trading volumes in the market and increased volatility as a result. On the data front this week we have Swiss inflation figures released, retails sales data from Canada and we also have the Bank of Japan's monetary policy decision. Call in now to for a live market quote and further news and analysis.
Sterling
Yesterday proved the theory that it is easier to talk down a strong currency e.g. the euro rather than boost a weak currency e.g. Sterling as the European Central Bank President hinted at possible euro interest rate cuts. This resulted in Sterling having a strong end to the week - pushing back above the 1.17 level against the euro and the 1.57 level against the US dollar. The incoming Governor of the Bank of England Mark Carney gave evidence to a committee of MPs and he quelled speculation that he would look to extend stimulus programs (which would further weaken sterling), saying that it is "entirely…probable that the current stance of policy is consistent with the economy achieving escape velocity." The Bank of England later held interest rates, implying that the Monetary Policy Committee also agree that, given time, the status quo will suffice. Other data released this week produced much better than expected Services Purchasing Managers Index (PMI) but the construction figures disappointed the market. Today is not likely to hold as much excitement, the key question being, with very little data released; can the pound hold the ground it has won back? Get in touch to find out.
Euro
The euro bubble sprang a leak yesterday after the President of the European Central Bank admitted that recent strength of the euro could hurt Eurozone’s economy. The euro fell across the board, losing over 1% to the pound, trading over 1.17 for the first time in a week and dropping below 1.34 against the US dollar. The ECB also held interest rates on Thursday and the President of the European Central Bank remarks have raised the possibility, albeit slight, of a rate cut in the coming months – this would please the French President who had already warned that a strong currency could deepen the recession and called for an exchange rate policy to be implemented. Political turmoil in Italy and Spain has also sent some shockwaves through Europe this week. The Spanish Prime Minister is being called upon to resign following reports suggesting a corruption scandal and Berlusconi - the ex-Italian Prime Minister – has emerged as a front runner for the next general election causing more uncertainty as to which party will win the election race. The Economic Summit continues today, so expect the volatility to continue as traders listen for snippets of information from Eurozone ministers. Call in now for the most up to date news, and to see if the leak has been stemmed.
US dollar
The US dollar has had a relatively strong week – reaching an 8 month high of 1.5630 against sterling, a 2 week high of 1.3380 against the euro and is headed towards the 94 line against the Japanese yen (already at a three year high). This week, a speech from President Obama sought to limit the size of the super cliff by addressing matters before it really comes to a fore. Unemployment data released was more or less as expected as was the outcome of Services PMI data showing an industry expansion figure of 55. Important import/export data released today should show more positive data from the US as the States look to play-down fears surrounding the US fiscal cliff. Call in now for an update and to get a live price from your trader.
Worldwide
Elsewhere, the Japanese yen was the big story of the week- breaking through the 93 level against the US dollar for the first time in three years following the news that the Governor of the Bank of Japan planned to step down early; accelerating a transition that may aid the new Prime Minister's monetary easing plan coming sooner rather than later. The Canadian dollar rose to a 2 week high on Wednesday, but slipped away as risk aversion and weak fundamentals brought prices down. The Australian dollar has continued to lose ground this week, falling to the lowest since November against the dollar this week with some analysts forecasting the fall to continue as traders suspect further easing measures. Get in touch now for the latest news and prices.
Sterling
Overall sterling had a relatively positive day yesterday, rising slightly against 14 of its major currency partners, whilst remaining relatively flat against the US dollar. Market speculation which suggests the next Governor of the Bank of England (BoE) - Mark Carney - will make major efforts to boost the economy once he comes into office in July seems to have put some confidence back into sterling in spite of the possibility of increased quantitative easing. This morning sees a speech from Mr Carney which could cause a great deal of volatility in the markets as traders react to clues as to what path he will look to steer the central bank down during his tenure as Governor. Later on we will have the decision on quantitative easing and interest rates from the BoE, both of which are widely expected to remain unchanged. Sterling remains under a lot of pressure, so call in now to see how it may react in a busy day on the currency markets.
Euro
The euro reverted back to Monday's state yesterday, falling against sterling and the US dollar, due to the underlining political uncertainty that remains in Italy and Spain. This weakening was echoed across the board as the European Central Bank policy makers prepare to meet later on today amid the political and banking turmoil that currently persists. The ECB press conference that follows could cause some jitters in the market following the recent call from the French President to devalue the euro to make it more competitive. It is a busy day all round for the euro today, with a wide selection of market data being released including German Industrial Production data and France's 10 year bond auction. Call in now for the latest update and for a live market quote.
US dollar
The US dollar had a broadly strong day yesterday, pushing to the highest levels in a week against the euro - gaining back nearly 0.5% recently lost as Obama sought to limit the size of the super cliff by addressing matters before it really comes to a fore. While today will be dominated by news from its major peers of Europe and the UK, unemployment data in the afternoon is expected to show a drop - undoubtedly good news for the US economy and further diminishing the likelihood of the central bank engaging in more monetary easing. With so much uncertainty elsewhere, the US dollar seems to be trading somewhat on the side-lines at present; but, recent positive news and data is helping to push the US dollar up against the majority of its peers. Get in touch now for the latest news and prices.
Worldwide
Elsewhere, the Czech koruna was yesterday's biggest mover, gaining 0.7% against both the US dollar and sterling whilst appreciating by 1% against the euro. This strength was attributed to the central bank's decision not to intervene in the currency market to loosen monetary conditions; but, decided to keep interest rates at effectively zero for a second meeting running. It was a different story for the Polish zloty, which declined 0.9% yesterday against the US dollar as monetary policy makers cut interest rates for a fourth consecutive month in an attempt to avert the biggest economic slowdown for more than 10 years. On a final note, the Australian dollar declined across the board after retail sales fell in December - adding more speculation that the Reserve Bank may cut interest rates next month. Late last night we saw the release of key employment data from New Zealand, early this morning we have data released from Switzerland showing the level of Foreign Currency Reserves and this afternoon, we have building permits data released from Canada. For an update on the markets and a live market quote, call your trader now.
Sterling
Sterling had a torrid day yesterday, undoing the positive gains it made on Monday. Sterling dropped to a 8 month low against the US dollar and weakened back towards 1.15 against the euro. This move came in spite of much better than expected Services Purchasing Managers Index (PMI) data being released showing the industry was expanding again when a slight contraction had been anticipated. There is little data expected to be released today bar figures showing the change in the price of homes. With sterling weakening and back down at historically low levels against both the US dollar and the euro, call in now to see if this trend is continuing.
Euro
After a poor start to the week on Monday, the Euro’s bubble appears to have not completely burst, performing well against the majority of currencies yesterday. On the data front, better than expect services PMI data was released across Europe (bar the Italian reading). The French President warned that a strong currency could deepen the recession and called for exchange rate policy to be implemented, however, the German Economy Minister rebutted this idea saying the focus should be on economic strength, not currency weakness. Such disagreement would normally reflect in low prices, instead the markets seem to have chosen to believe that the European Centrals Bank policy makers are not as concerned with the strong euro as the French President and that interest rates will remain unchanged on Thursday. Today will be quiet in terms of data bar the German factory orders figures, and markets will be focussing more on the Economic Summit starting on Thursday where we can expect more of the same positive rhetoric from Eurozone politicians which is likely to continue to support prices. Get in touch now for an up to the second exchange rate, and the latest news.
US dollar
While the US dollar had a mixed day yesterday, weakness elsewhere drove it to highs against the Japanese yen and sterling - trading consistently over 93 yen for the first time since the spring 2010, and the highest against sterling since August 2012. Services PMI data released yesterday came out as expected showing an industry expansion figure of 55.3 Once again today there is a dearth of data released so expect it to be a day for reaction from news released elsewhere once more. However, one to watch is the release of the Crude Oil Inventories coming out this morning, which can have a direct impact upon inflation and economic growth, especially given the recent talk of Shale Gas reliance in America. Call in now to for a live market quote and further news and analysis.
Worldwide
Elsewhere in the world, the Japanese yen dropped to its weakest level in three years against the US dollar thanks to the Bank of Japan's Governor stating that he plans to step down early; accelerating a transition that may aid the new Prime Minister's monetary easing plan. Going south of Japan, the Australian dollar had a tough day yesterday, falling against all of its major peers after the central bank signalled it is prepared to cut interest rates to a record low later this year. The Russian rouble had a strong day yesterday following the surge in the price of oil per barrel yesterday. The South African Rand performed well following data that was released showing that the unemployment rate has fallen nearly 25% in the fourth quarter and after the mineral resources minister said the government would not nationalise the mines. Overnight we saw the release of retail sales data from Australia, Canadian PMI data will be released in the afternoon and New Zealand will release unemployment data in the evening. Call in now for an update and live market quote from your trader.
Sterling
Sterling performed extremely well yesterday especially against the euro regaining the two cents it lost on Friday which highlights how quickly things can change and how volatile markets continue to be. This is a vast improvement on recent trends despite disappointing construction Purchasing Managers Index (PMI) data being released . As noted, the greatest improvement came against the euro, rising by nearly two cent to over 1.166 – recovering from the 15-month low of 1.1475 we saw on Friday afternoon. Reasons given for the recovery were firstly that sterling was 'over-sold' and traders took profits and secondly the markets realised that the Eurozone still has some very significant problems that need to be resolved. Having said that it is still important to remember that the fundamental issues that drove sterling weaker still remain. Today see’s the release of important Services PMI data which is an important indicator of current economic health. Call in now to see if sterling can continue to recover from the heavy losses it has incurred of late.
Euro
The euro's positive news flow was broken yesterday resulting in exchange rates dropping across the board. The 17 nation currency weakened to over 1.166 against sterling, whilst falling below 1.35 against the US dollar after failing to break the key level of resistance of 1.37 on Friday. This weakening has been widely attributed to increasing political turmoil within Italy and Spain, coupled with slumping bond prices within the stated countries. The Spanish Prime Minister is being called upon to resign following reports suggesting a corruption scandal which is not only damaging the current government but also confidence in the country as a whole. In Italy – the ex-Prime Minister Berlusconi’s resurgence as a front runner for the next general election is making it look ever more likely that there will be no majority and cause a hung parliament. Today sees the release of services PMI data from Italy, Spain and Europe as a whole; furthermore, we also have Euro-area wide retail sales data being released. Call in now for a live market quote and to discuss the state of the euro with your personal trader.
US dollar
The US dollar performed fairly well yesterday in the absence of significant data being released from the US and as risk aversion drove the market due to the uncertainty developing in Europe. Today could well see a similar trend with the US dollar taking its cue from elsewhere as the only major data release is the Services PMI figures. The last few months Services PMI releases have come in above expectation and if this week's figures are as positive we can expect markets to react favourably. Good news, especially if backed up by unemployment data on Thursday could indicate that recovery is well underway on the other side of the Atlantic, and drive risk appetite. As the economic health of the region looks up, it may well only be the threat of March's super-cliff that weighs on prices. Call in now for an update and to get a live price from your trader.
Worldwide
In other news, the Japanese yen weakened again yesterday - breaking through the 93 level against the US dollar for the first time in recent years - before recovering from its decline in a move that suggest the currency may have been oversold. The Polish Zloty gained sharply early yesterday morning, following the news that the Prime Minister's had announced that he plans to launch an official debate into the country's possible adoption of the euro. The Australian dollar performed well yesterday as markets waited on this morning’s Reserve Bank of Australia statements, gaining in anticipation of a narrowing trade deficit and an expected hold on interest rates, which were duly held. Get in touch now for the latest news and prices.
Sterling
It was a hugely disappointing end to the week for sterling, suffering heavy losses versus all of its major trading peers and compounding the losses that have been on-going for the entire week. News that key Manufacturing Purchasing Managers Index (PMI) had come out worse than previously forecast further dampened demand for the sterling; culminating in the British currency falling to a 14-month low versus the euro, falling at one stage below 1.15 in the process. It was a similar story versus the US dollar, with increasing pessimism surrounding the UK's economic recovery being a key factor in sterling falling from Thursdays 1.58 level and then falling below 1.57 overnight. This week sees a host of data released from the UK, with key Construction and Services PMI released early in the week, before attention turns to the Bank of England's latest decision on levels of quantitative easing and the base interest rate. There will also be a commentary from the next BoE Governor Carney who will be testifying to the UK’s Treasury Committee about his appointment. Call in now for an update and to get a live price from your trader.
Euro
With the release of little data to disrupt the strengthening flow of the euro, the 17 national currency continued to strengthen across the board on Friday; at one stage hitting 1.37 against the US dollar and 1.150 against sterling. With only limited mid market data to be released this week, it is looking that the euro is going to continue to strengthen. The President of the ECB's ‘positive contagion’ seems to be working as the early economic data for 2013 has shown some small improvements and the euro has been the stand out performer in January gaining nearly 7% against sterling and 10% against the Japanese yen. The ECB Council meeting will be the most important event this week, however, we also have data showing the Spanish unemployment change and a French 10 year bond auction. It will be interesting to see how well the French bond auction is received following last weeks comments from a French Labor Party Minister who described the economy as “totally bankrupt”!. Call in now for a live market quote from your personal trader.
US dollar
The US dollar had a mixed day on Frdiay as the US economy is already displaying a stronger start to the New Year than most of its competitors, as shown by the January jobs data which rose by 157,000. Furthermore, manufacturing PMI data and consumer confidence figures also beat market expectations; however, the overall employment rate has now risen to 7.9%. Service PMI data, trade balance data and the weekly unemployment claims data will be the main releases in what is otherwise a relatively quiet week in the US. Call in now to see how the US dollar is fairing and to get an up to date quote from the live market.
Worldwide
Elsewhere, Friday saw the Japanese yen drop to the lowest level since 2010, with the US dollar buying over 92 yen as the yen continues to be driven by speculation and rhetoric over who the next Bank of Japan Governor might be. The Canadian dollar slid after gains earlier in the week as oil prices - the country's main export - fell. The South African rand finally ended its negative trend last week as strong figures in the USA gave markets confidence that exports would pick back up. This week sees the release of a number of important releases from Australia, culminating in a statement on Monetary Policy from the Reserve Bank of Australia so expect volatility. There is also a raft of data out of Canada, get in touch now for the latest news and prices.
Sterling
Thursday finally saw some good news for sterling, having been in decline versus its most-traded peers for the majority of the week. The impacts of considerably worse than expected 4th quarter GDP data released last Friday, combined with increasing global economic confidence - most notably across the Eurozone - continued to dampen demand for the British currency early this week. There was a slight respite for sterling on Wednesday, as news emerged that one of the Bank of England's key policy makers suggested 2013 economic growth is likely to be much higher than previously estimated. Yesterday's news that both consumer confidence and house prices had risen from last month's figures saw a small amount of positive sentiment return to the UK economy, helping edge sterling away from its thirteen month and five month lows versus the euro and US dollar respectively. Today sees the release of key Manufacturing Purchasing Managers' Index (PMI), likely to give a clear insight into the current extent of UK economic recovery. Having seen shocking manufacturing data earlier this month, any decline is likely to further weaken demand for sterling. Call in now for the latest news and to get a live price.
Euro
The euro fared well this week, gaining versus all major currencies due to the improving economic confidence continuing to trickle throughout the 17 nation currency. There has been significant economic data released this week, most importantly the German Consumer Climate coming out as predicted, providing a clear insight into the current level of economic confidence in the Eurozone's largest economy. News that Spanish fourth quarter GDP had contracted by 0.7% did little to dampen demand for the euro, with it nearing the end of the week at thirteen month highs versus both the US dollar and sterling. It was also revealed that the ECB is less likely to ease monetary policy when compared to other central banks such as the Bank of Japan and the Bank of England, which supports the view that the euro will not deviate off its current rally in the short to medium term. Call in now for a live market rate from your personal trader.
US dollar
It has proved to be a difficult week for the US dollar, losing ground versus many of its major trading peers. A continued rise in economic confidence throughout the Eurozone significantly weakened demand for the US dollar, seeing it fall to the lowest level versus the euro since November 2011. News that fourth quarter GDP data had showed a contraction of 0.1% - the first decline in growth since 2009 - did little to decrease global risk appetite. This continued to dampen demand for the US currency, seeing it lose some of its previous gains versus sterling, returning towards 1.59 by Thursday afternoon. It was a better weak versus the Japanese yen, reaching the highest level since June 2010. Mixed unemployment data earlier in the week should render today's key Non-Farm Unemployment figures hugely influential. Call in now for the latest news and to see how it has impacted the dollar.
Worldwide
Elsewhere it has been a significantly mixed week for many other currencies as continued play-off between risk appetite and aversion greatly influenced demand for typically higher-yielding assets. Such a case is evident in the New Zealand dollar, gaining versus the majority of its peers early in the week, before losing substantial ground on Wednesday as it emerged the Reserve Bank of New Zealand wants to weaken the currency. It has been a mixed week for the Australian dollar, strengthening on the back of better than expected consumer confidence, before increased risk aversion dampened demand for the currency later in the week. The Japanese yen suffered a similar fate, gaining substantial ground versus its major peers on Monday as the Bank of Japan suggested the currency had weakened too far, before losing ground towards the end of the week. Overnight saw the release of key inflation data from Australia, along with Chinese Manufacturing PMI. Call in now to see what impact these releases have had and to get a live price.
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