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.
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.
Euro
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.
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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