Sterling
It was a fairly quiet day for the US dollar yesterday with little being released in the way of influential data. The result being that performance was largely dependent on international events elsewhere. Little change was registered against sterling as the rate remained marginally around 1.51; but, we saw a knee jerk reaction against the euro, dropping to 1.2880 before the euro recovered some of these losses later on. Today sees the release of monthly US building permit data, which gives some indication as to what can be expected from the construction industry over the coming months. The data is predicted to show a marginal improvement on last month in line with a gradual US recovery. Call in now for live rates and up to the minute information.
Worldwide
Elsewhere, the Swiss franc and Japanese yen both strengthened yesterday largely based on concerns emerging from Cyprus. The appreciation of the Swiss franc and the Japanese yen came as people turned back to safe haven currencies once more following the new bank levying plans that need to be enforced for Cyprus to receive its bailout funds. The Australian dollar struggled based on a nervy outlook on the situation in Europe whilst traders awaited the minutes from the latest monetary policy meeting from the Reserve Bank of Australia. The Hungarian forint continued its decline following the appointment of the new central bank governor and due to the governments recent comments about reducing the level of private FX debt. Call in now for a live update from the markets.
Sterling rose against all but three of its 16 major peers yesterday as risk aversion swept through the market. It strengthened the most against the euro reaching a five-week high after the proposed levy on bank deposits in Cyprus was announced. Today we will see a raft of inflation data out of the UK, with Consumer Price Index (CPI) expected to rise to 2.8%, marginally above the 2.7% reading we have seen for the past four months. The Bank of England (BOE) has recently warned that inflation might stay above its 2% target for the next two years. Tomorrow we have the minutes of the last Bank of England meeting released and the UK spring budget. Therefore given what is happening here and elsewhere the likelihood of volatility is high, so please call in today for the latest news from your trader.
Euro
The euro had a torrid start to the day yesterday, dropping the most in fourteen months before stabilising in the afternoon. The mass euro sell off followed news over the weekend that Cyprus must raise 5.8. billion euros through taxing deposits in order to secure the 10 billion euros bailout it requires. Yesterdays vote on the tax was delayed until today with Cypriot banks shut until Thursday 20th. Since then, there have been developments and last night the ECB agreed to ease the terms of the levy for smaller depositors; but, stated that the revenue target remains the same. The fear of contagion is evident in the markets and you do wonder if there will be a run of the Cypriot banks once they open for business as savers move their funds elsewhere. This would create another funding crisis for Cyprus. However a former Central Bank of Cyprus governor has highlighted that should parliament vote against the bank levy, it would cause "chaos", which seems likely as at least one major Cypriot bank would more than likely go bust. Economic sentiment data will be released today, but you can expect it to play second string to any news coming from Cyprus. Call in now for the latest update and a live price.
US dollarThe euro had a torrid start to the day yesterday, dropping the most in fourteen months before stabilising in the afternoon. The mass euro sell off followed news over the weekend that Cyprus must raise 5.8. billion euros through taxing deposits in order to secure the 10 billion euros bailout it requires. Yesterdays vote on the tax was delayed until today with Cypriot banks shut until Thursday 20th. Since then, there have been developments and last night the ECB agreed to ease the terms of the levy for smaller depositors; but, stated that the revenue target remains the same. The fear of contagion is evident in the markets and you do wonder if there will be a run of the Cypriot banks once they open for business as savers move their funds elsewhere. This would create another funding crisis for Cyprus. However a former Central Bank of Cyprus governor has highlighted that should parliament vote against the bank levy, it would cause "chaos", which seems likely as at least one major Cypriot bank would more than likely go bust. Economic sentiment data will be released today, but you can expect it to play second string to any news coming from Cyprus. Call in now for the latest update and a live price.
It was a fairly quiet day for the US dollar yesterday with little being released in the way of influential data. The result being that performance was largely dependent on international events elsewhere. Little change was registered against sterling as the rate remained marginally around 1.51; but, we saw a knee jerk reaction against the euro, dropping to 1.2880 before the euro recovered some of these losses later on. Today sees the release of monthly US building permit data, which gives some indication as to what can be expected from the construction industry over the coming months. The data is predicted to show a marginal improvement on last month in line with a gradual US recovery. Call in now for live rates and up to the minute information.
Elsewhere, the Swiss franc and Japanese yen both strengthened yesterday largely based on concerns emerging from Cyprus. The appreciation of the Swiss franc and the Japanese yen came as people turned back to safe haven currencies once more following the new bank levying plans that need to be enforced for Cyprus to receive its bailout funds. The Australian dollar struggled based on a nervy outlook on the situation in Europe whilst traders awaited the minutes from the latest monetary policy meeting from the Reserve Bank of Australia. The Hungarian forint continued its decline following the appointment of the new central bank governor and due to the governments recent comments about reducing the level of private FX debt. Call in now for a live update from the markets.
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