Sterling continues to be the poor relation | Smart Daily Currency Note

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.