Sterling stays under pressure | Smart Daily Currency Note

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.