Sterling
Despite a quiet day on the data-front, sterling had a weaker day yesterday, dropping against all its major peers bar the poorly performing Australian and New Zealand dollars. It had a particularly weak afternoon, dropping almost a cent against the US dollar in just over an hour; whether this is a bump in the road or a sign of changing fortunes for the recently buoyant sterling remains to be seen through a quiet week for UK economic data. Prices today are likely to be effected by data released elsewhere whilst at the same time looking ahead to the Central Bank's rate decision on Thursday. Stay in touch with developments by talking to your dedicated trader today.
The euro gained through early trading off the back of better than expected German factory order figures, pushing back against a weaker performing sterling and Swiss franc. Though it relinquished some ground to the US dollar, the euro managed to make gains throughout the day thanks in part to a successful Portuguese bond auction. With German industrial orders for March beating forecasts some relief was bestowed to the single currency though the general outlook for the region in the longer term is still decidedly less auspicious. We expect very little data to be released today, nonetheless, with trading volumes decreased as Europe begins two days of bank holidays we could see increased volatility so call in now for an up to the second rate.
It was a relatively quiet day for the US dollar yesterday following the release of some influential figures towards the end of last week which has seen it gain against the Japanese yen in recent days. Ground was made against sterling as the rate dropped back below 1.55, as well as a steadily performance against the euro whereby the currency continues to hold firm in the wake of the stronger than expected monthly US jobs report last Friday. Some movement may come today as a member of the Federal Open Market Committee is speaking alongside the release of crude oil inventories data and the 10-year bond auction. Looking further ahead to Thursday we shall see whether unemployment claims data corroborates figures from last week. Call in now for live rates and up to date information.
Elsewhere, markets were still reacting to the Reserve Bank of Australia’s surprise decision to cut interest rates to record lows – forcing the Australian dollar weaker against most of its major peers and to its lowest level in two months against the US dollar. The market had been divided on the prospects of rates being slashed and the potential for further loosening could weigh heavily on the currency's price levels in the coming weeks as the economy rebalances and the government attempts to stimulate exports. Faring little better was the New Zealand dollar which tracked its Australian counterpart downward during the day – suffering again particularly against the US dollar. Late last night the Reserve Bank of New Zealand presented its Financial Stability Report and later on this evening employment data will also be in focus with releases from both New Zealand and Australia. Call in for an immediate update with Smart.
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