Sterling continues to fall | Smart Daily Currency Note

Sterling

On the whole a disappointing week for sterling - strong retail sales figures early in the week were encouraging signs for the British economy, giving sterling a short boost, but it has slipped away since. Key to driving this decline was two further members of the monetary policy committee calling for a looser monetary policy to stimulate growth in the country. Yesterday, the Office for national statistics revised their figures from last year to say that growth was substantially lower than previously thought, but, Britain did not see the two consecutive quarters of negative growth which would indicate a double dip recession. The focus for the next few days is undoubtedly going to be Mark Carney's entrance as new Governor of the Bank of England. While he has made it clear that there is no panacea for British economic woes, great expectations rest on his shoulders. Call your trader today for the latest news and rates for the UK and sterling. 

Euro

The euro struggled this week, following comments from the President of the European Central Bank President who said that the economic outlook still warrants an accommodative monetary policy stance. Notably, the euro bought less than 1.30 US dollars for the first time in a month on Wednesday. The European economic summit kicked off yesterday, with ministers from across the Eurozone attempting to come to a conclusion on a banking union. Positive unemployment figures from Germany lent some support to a struggling euro yesterday putting a halt to the downward trend, but the overall picture is still not strong for the 17-member state currency. Get in touch today for the latest on the euro. 

US dollar

The US dollar has enjoyed a very strong week – reaching 1.30 against the euro and 1.52 against sterling at its peak. The Chairman of the Federal Open Market Committee kick started the trend with the announcement last Friday that stimulus programs will be tapered out. Positive data from the States helped the US dollar to strengthen further still, indicating a healthy recovering economy. This trend of dollar strength continued in spite of GDP figures being revised down from initial expectations showing growth was only at 1.8%, a long way shy of the 2.4% that had initially been anticipated. Speak to your trader for up to the second rates, and the latest market news. 

Worldwide

Elsewhere, as Kevin Rudd returned for a second stint as Prime Minister of Australia following a party leadership ballot, the Australian dollar enjoyed the most positive week it has in some time. The Norwegian krone fell almost 2 percent against sterling as markets continued to react to last week's surprise cut in interest rates, with its Swedish counterpart being hit hard too though seeing some recovery through the week. The Indian rupee continued to free-fall, moving to new all-time lows. GDP data released from Canada this afternoon is expected to show the economy only grew by 0.1%; any variation away from this could spark a big reaction in the market. Call your trader for rates and news for your currency. 

The US dollar continues to strengthen | Smart Daily Currency Note

Sterling

Sterling had a poor day yesterday, losing considerable ground to the US dollar, and only just holding its own against a weak euro. The drop came as one of the members of the monetary policy committee called for a looser monetary policy to stimulate the economy. Current account figures (the difference in value between imports and exports) are released today and may well lead to another eventful day’s trading for sterling. The other key release will be the final reading of the UK’s GDP from last quarter, currently expected to confirm that we saw mild growth of 0.3%, any significant variation away from this figure and we could see a big market reaction.  Call in now for the latest news and up to the second rates for sterling.

Euro

The euro continued to struggle yesterday, falling to three week lows against the US dollar and breaking through the 1.30 level, as two further members of the European Central Bank (ECB) reiterated President Draghi’s comments that monetary policy would remain accommodative for as long as necessary. Today is quiet for major releases as the EU economic summit commences with the European banking union back on the agenda. Call your trader now for the latest update from the market.

US dollar

The US dollar enjoyed a very strong day, adding to Tuesday's gains. This move came in spite of the final GDP reading coming out much worse than expected showing growth was only at 1.8%, a long way shy of the 2.4% that had initially been anticipated, whilst 1st quarter growth figures were revised down to 1.8%. This caused the dollar to weaken off initially before continuing to strengthen late on with the US dollar challenging the 1.53 resistance level against sterling and breaking through the 1.30 mark against the euro. Employment figures released this afternoon will be the main talking point for dollar traders, as well as comments from two members of the Federal Open Market Committee. Call your trader today for up to the second rates.

Worldwide

Elsewhere, as Kevin Rudd defeated Julia Gillard in a party leadership ballot to become Prime Minister, the Australian dollar gained a cent against sterling to reach week highs. The Indian Rupee weakened to new all-time lows – breaking through the 93.0 mark against sterling as the currency continues its free-fall. The Japanese yen held its own, after recent demand for the safe haven currency began to cool. Overnight we saw the release of Trade balance data and business confidence figures from New Zealand, but little else is scheduled to be released today. Get in touch with your trader today for the latest for your currency.

Sterling makes steady gains against the euro | Smart Daily Currency Note

Sterling

Sterling drifted through yesterday without making many waves and gaining slightly against the euro. This was despite the market starting to develop nerves as to the impact that the new Bank of England Governor Mark Carney may have when he starts on Monday. Modest gains in mortgage approvals indicate a recovering property market, matched by realised sales figures, perhaps Mr Carney is taking the reins of a horse that is finally gathering some speed. The incumbent Governor Mervyn King speaks this morning on economic stability, a speech which looks likely to be largely a hand over speech. We can generally expect volatility while he is speaking as traders listen for hints as to future monetary policy. Call your trader now for up to the second rates. 

Euro

The euro struggled yesterday losing almost a cent to a buoyant US dollar, and half a cent to sterling, as ECB President Draghi said that the economic outlook still warrants an accommodative monetary policy stance. First thing this morning we have seen the release of consumer confidence data from Germany, but, with little data released from the rest of Europe today, the question is where the downward trend stops. If rates nudge through the 1.18 mark against sterling, we could see further gains for sterling, but that level hasn't been broken in 2 months so the chances are limited. A meeting between the Finance Ministers of the EU member states commences today and so any significant news emanating from these meetings could cause a notable reaction in the market. Call your trader today for the latest news and live prices. 

US dollar

The US dollar climbed yesterday as three key sets of data exceeded expectations. Core Durable Goods orders, not expected to rise, added 0.7% to last month's release. Consumer confidence, and New Home sales compounded the effect later in the afternoon adding support to a rising dollar and a recovering American economy. Positive fundamentals from the States are likely to have an exaggerated effect on currency values in light of the Federal Reserve's recent taper talk - a strengthening economy suggesting that a winding up of quantitative easing is close. Today is far quieter, the only major release being quarterly GDP figures. The preliminary figures were released a month ago meaning any effect will likely have already been seen - though any deviation from the 2.4% growth would shock markets. Call your trader to find out where the US dollar is trading now. 

Worldwide

Elsewhere, the Japanese yen strengthened yesterday rebounding from two-week lows against the US dollar. Yen strength was a reflection of underlying nervousness in the global market, as concerns over a shortening supply of liquidity in China and the US raise demands in the short term for the relatively safe Japanese currency. The Canadian dollar had another tough day, although marginally better than we have seen over the last five days or so. The weakness yesterday was a response to strong data coming out of the US fuelling rumours that Canada's largest trading partner will slow monetary stimulus. The Australian dollar held ground against its main trading partners, hovering tentatively above 33-month lows against its US counterpart. The growing consensus is that the Aussie dollar will remain relatively low for the foreseeable future. The most notable piece of data released today is the monthly trade balance figures coming out of New Zealand. Call in for latest news and rates for your currency. 

Sterling stronger against the euro | Smart Daily Currency Note

Sterling

Sterling had a good day yesterday even though there was an absence of data released across the global markets. With strong retail sales figures last week there are encouraging signs for the British economy and sterling recovered from session lows to stem the its decline against the US dollar. Mortgage approval data today will shed some light on demand in the housing sector whilst Bank of England officials testifying on inflation could affect the markets early on. Moreover, with revised first quarter growth figures due on Thursday sterling prices could experience increased volatility as the week goes on, especially if there is a big revision from the original estimate . Call in now for the latest updates.

Euro

The euro was fairly flat yesterday, with no movement either way against the US dollar, and losing half a cent to a better performing sterling as a survey of Business Climate in Germany underwhelmed the markets. Today is even quieter on the news front than yesterday, but we can still expect to see volatility as the euro remains susceptible to releases from around the world. Increasing concerns that Germany – Europe’s powerhouse - is struggling to return to a state of growth will affect the euro's relative price as the week progresses due to the substantial amount of key data released throughout the remainder of the week. Call in today for the latest news and rates for the euro.

US dollar

It was a relatively weak day for the US dollar yesterday, losing ground to sterling and failing to make any gains against the euro. In contrast to yesterday's slow news flow, today sees a number of key releases. At present, forecasts suggest that consumer confidence may have tailed off since last month, core durable goods orders are expected to have slipped slightly, but, new home sales are set to have increased. With all three releases coming in the early afternoon US time, we can expect volatility but which way the dollar is likely to trend is less certain. It would seem that a dramatic move is only likely if either of the sets of figures surprise, though the main driver in the market still surrounds the Federal Reserve’s potential to tighten monetary policy. Call your trader today to find out how the dollar has been moving.

Worldwide

Elsewhere, the Canadian dollar continued to struggle in the wake of the US Federal Reserve's announcement last week that it will end monetary stimulus. The Canadian dollar declined against the majority of its 16 major trading partners yesterday; approaching a two-year low against its US counterpart. Both Scandinavian krone struggled, carrying over a difficult end to last week. The Norwegian krone fell almost 2 percent against sterling as markets continued to react to last week's surprise cut in interest rates, with its Swedish counterpart being hit hard too. Today is fairly a fairly quiet day data-wise, though we can expect volatility around lunch time as the Swiss National Bank governor speaks. Markets will doubtless react to any hints as to future economic policy. Get in touch for up to the second rates and news for your currency.

Lots of data, will sterling hold its own? | Smart Daily Currency Note

Sterling

Sterling, though losing ground against a buoyant dollar, performed well against the euro following the news that the UK public sector net borrowing rose at a slower rate than anticipated in the last quarter. The National Statistics Office reported that borrowing rose to 10.5 billion pounds rather than the expected 13.8 billion pounds. The UK currency is performing steadily against its euro counterpart as core macro-economic data, such as last week's robust Retail Sales and the improving housing market, support sterling. This has cooled speculation that Mark Carney will preside over more quantitative easing or interest rate cuts when he takes over the helm at the Bank of England next month though residual concerns do remain that his historically accommodative attitude to monetary policy could manifest itself should UK data worsen. Indeed, the disappointing Confederation of British Industry survey last week is a reminder that the recovery in this country is not completely assured and eyes will be on Wednesday's inflation report hearing as well as the current account figures and final GDP reading on Thursday as we move towards the end of the month. Be in touch throughout for the latest developments.

Euro

The euro felt the effects of a resurgent US dollar strength on Friday as the rate dropped by over a cent during the day. Whilst data concerning the difference between the value of imports and exports came out favourably for the euro, this did little, if anything, to prevent a significant slide. With regards to influential releases this week, this morning we have business climate data from Germany and later on this week we will have more data from Germany including the change in unemployment and retail sales figures. As always, traders will pay special attention to data emanating from Germany due to its position as Europe's biggest economy. The main other event this week will be the EU Economic Summit where the focus will be on economic policy and the completion of the EU's economic and monetary union. Call in throughout the week for the latest rates and developments in euro value.

US dollar

The US dollar strengthened further on Friday pushing down to the 1.31 mark against the euro. Markets had surged following the announcement of a plan to bring stimulus to an end. It is another busy week for data in the US with Core Durable Goods Orders, Consumer Confidence and New Home Sales all due for release on Tuesday. Other key releases will be the final GDP reading which is expected to show the economy grew at a rate of 2.4% and on Thursday there will be the weekly release of unemployment claims alongside data showing the number or homes pending sale. Several members of the Federal Open Market Committee will also be speaking this week and it will be interesting to see what they say following last weeks comments from the Chairman of the Federal Reserve where he stated that he expected to start reducing the quantitative easing programme later this year and hopefully end it by the middle of next year. Stay in touch throughout the week with Smart.

Worldwide

Elsewhere, the Norwegian krone slid downwards for a fifth day against the US dollar, marking a week of decline not seen for over 20 years. For the first time since 2010, the Norwegian krone weakened past the 8 per euro mark following the Norwegian central bank's predictions that benchmark interest rates could be lowered this year. Sweden's krona meanwhile slipped the furthest in 2 months and the Canadian dollar dropped to near 2-year lows after the country's May inflation rates grew slower than expected and retail sales figures disappointed. It is a busy week on the data front with Trade Balance and Business Confidence figures from New Zealand; a slew of Japanese data including inflation statistics, industrial production and retail sales data, whilst we have all important GDP data from Canada which is expected to show there has been no growth what so ever. Be in touch with your trader throughout the week for information and prices from your currency pair.

Difficult week for sterling especially against the dollar | Smart Daily Currency Note

Sterling

A difficult week for sterling especially against the US dollar and to a lesser extent against the euro. This contrasted with sterling gaining  ground when compared to the commodity backed currencies. Thursday saw the release of better than expected retail sales data which gave some support to sterling yesterday, helping the UK currency to stabilise after Wednesday's losses. Sterling traded within a relatively narrow range against a surging US dollar whilst posting modest gains against the euro. However, it remains to be seen if sterling will be able to hold its ground against the dollar as the Monetary Policy Committee's uncertainty is now in stark contrast to the Federal Reserve's newly assertive attitude towards quantitative easing strategy. The only UK news with the potential to directly affect sterling performance today is the release of public sector net borrowing data, which will show the difference between income and expenditure in the public sector during the month of May. Call in now to see how sterling prices react to continuing dollar strength ahead of Mark Carney taking over as the Governor of the Bank of England next month.

Euro

The single currency has performed well for much of the week, but after rising to a four month high against the US dollar the euro lost ground in many pairings following poor German manufacturing sector data. Though many areas of the report outperformed (and despite better service sector figures and evidence of slower decline in new business) the composite output index still described manufacturing activity shrinking overall. French manufacturing results similarly showed a contraction though not to the extent many had anticipated, with the euro losing around half a cent against sterling. With only news on the European current account balance today there is going to be increasing pressure on Mario Draghi and the European Central Bank to find innovative ways of stimulating the economy. The question is, what can turn the tide and get the euro back on an upward trend. Call your trader today for the latest news and the best live prices on your euro trades.

US dollar

The US dollar had a good week in the wake of the Federal Reserve's news that it plans to taper back its quantitative easing initiative. Volatility in currency markets as a result were at the highest levels in a year as the US currency forged ahead against its most traded counterparts. This performance is set to continue as long as the world's largest economy keeps improving – especially in regard to employment figures. Despite news that jobless claims had in fact increased last week, better than forecast factory activity and home sales figures increasing over 4% helped extend dollar value, with the reserve currency also being bolstered by investors selling off interest in other currency markets seeking a safe haven. What needs to be noted though is that the US dollar is only back to the level it was against sterling two weeks ago. In the interim there has been a two cent up and down movement but this seems to point to a correction rather than a full blown collapse for sterling.  Call your trader with any US dollar currency requirements to discuss how to maximise your potential in this market.

Worldwide

Elsewhere, US dollar strength weighed heavily on world currency markets. India's rupee fell by 1.5% against the US dollar - a record low. Similarly, due to the on-going political turmoil in the region, Turkey's lira was at an all-time low against its American counterpart on Thursday whilst the Polish zloty dropped by 2%. The Australian dollar continued its slide, falling for a fifth day, exacerbated by the Chinese purchase Managers Index for the manufacturing sector posting lower than expected results. The relationship between Chinese economic growth and Australian currency strength remains close, and price levels are likely to keep sliding along with interest rate levels as long as expansion in the Chinese economy continues to decelerate. The Bank of Japan Governor speaks this morning whilst Canadian inflation and retail sales data are certain to impact Canadian dollar prices heavily. Keep up-to-date by calling Smart today.

Sterling suffers as the US recovers | Smart Daily Currency Note

Sterling

America sneezes and the UK catches a cold. The Federal Reserve laid out its time plan for reducing and ending its programme of quantitative easing last night and sterling quickly lost ground against both the US dollar and the euro. Not a surprise against the US dollar as any programme of quantitative easing should always weaken a currency as international investors look for constant yields, so the ending of it should strengthen a currency. However it is surprise to see the euro strengthen at the same time. Perhaps its uncertainty about what the UK is likely to do with its programme of quantitative easing as yesterday saw the publication of minutes from June's Bank of England monetary policy committee meeting which again revealed that three members had voted for additional monetary stimulus. Outgoing Governor Mervyn King as well as two other policymakers voted in favour of increasing the size of the asset purchase facility by a further 25 billion pounds, whilst six voted in favour of keeping it steady. The vote on interest rates was unanimous in holding levels at a record low of 0.5%. Matters could be different however in next month's meeting when Mark Carney takes over at the Bank of England. Previously a staunch advocate of loose monetary policy, many are still unsure whether he will follow his predecessor in looking to augment the money supply. Look out for retail sales data today affecting price levels by talking to your trader.

Euro

Yesterday was a quiet day for the euro with the single currency seeing little movement against both its sterling and US dollar counterparts until the Federal Reserve announcement towards the end of the day. We can expect further volatility today as traders react to both Services and Manufacturing Purchase Manager's Index data from France and Germany due to be released this morning. Germany has started to show more sustained strength across different sectors, though more bad news emanating from the French economy is likely to further permeate through to the political and social unease among the population. Much attention will be on today's Eurogroup meetings, with a cohesive strategy for ending the recession across the region still thus far proving elusive. Quantitative easing policy will again have a strong impact on currency markets, though the European Central Bank has expressed its willingness to adopt any method necessary to stimulate growth. Call in now to see how these events affect euro performance and for a live quote on your trading requirements.

US dollar

The US dollar consolidated throughout much of Wednesday ahead of last night's highly anticipated Federal Open Market Committee policy statement. Once made the dollar strengthened across the board as the Chairman of the Federal Reserve stated that they expected to start reducing the programme later this year and hopefully end it by the middle of next year. They also expected interest rates to start rising on 2015. The preface to all this is improving economic conditions in the US and reduced unemployment which is far from certain given the reduction in government expenditure and increase in taxes made earlier this year. Speculation regarding quantitative easing has been fuelling price fluctuation in all markets related to the dollar for months, and we are likely to see more movement throughout the day as markets adjust to Ben Bernanke's more detailed assertions regarding monetary policy going forward. Data released today will include the US home sales and manufacturing index figures. Call Smart today for the latest developments.

Worldwide

Elsewhere, The Australian dollar failed to rebound from recent losses yesterday following a three day slide. With commodity prices continuing to fall, there would seem to be little hope of a recovery for the economy or price levels in the near future with the currency being one of the worst performing this year. Things were better for Australia's antipodean cousin as the New Zealand dollar made gains in the wake of whole milk powder (one of the country's biggest exports) rising in value for the first time in 2 months alongside a narrowing of the nation's current account deficit. Today the Swiss National bank hold a press conference on interest rates and monetary policy: while no change in rates is expected, expect volatile market conditions over the course of the conference. Call your trader today for the latest news and rates for your currency.

Sterling slips badly as inflation disappoints | Smart Daily Currency Note

Sterling

What was expected to be a quiet day for sterling quickly changed as sterling lost over a cent against the euro and the US dollar mid-morning. The initial catalyst for this was Consumer Price Inflation having increased at a rate of 2.7% in May, higher than expectations and up from 2.4% the previous months. Worries about what today’s Bank of England minutes will contain following this higher than expected inflation also unnerved the markets. And then we had the President of the European Central Bank announce that they were considering non-conventional measures to stimulate the Eurozone which lent support to the euro.  Just highlights how nervous the markets still are and we are likely to see further volatility throughout today as the official BoE meeting minutes are released this morning and Bank of England Governor Mervyn King speaks this afternoon. Due to rising petrol, clothing and air travel costs keeping inflation rates stubbornly above the bank's the 2.0% target, further quantitative easing and interest rate changes remain hot talking points. Speak to your trader now for an update on sterling activity.

Euro

The euro has now overtaken the Swedish kroner as the year's strongest performing major currency. Though this is testament to investor confidence in Europe's government officials, inflating currency value threatens smaller member nation's ability to stimulate exports amidst the longest recession in memory. Indeed, recent statistics showed goods sold to outside the euro zone fell 0.8% from the previous quarter. Yesterday morning's German ZEW sentiment surpassed expectations for the month. The reading emerges despite many markets weakening, and though a consensus of 38.5 is still well below March's reading of 48.5, the single currency performed well on Tuesday – continuing its ascent against the US dollar and jumping by almost a cent against sterling. The survey certainly suggests Germany’s economy is due to gather pace in the second half of the year, though with the open possibility of negative deposit rates, an accommodative monetary policy and stagnant growth overall, a sustained rise in euro prices may not be healthy for a struggling Eurozone economy. Please telephone in for feedback on the euro.

US dollar

Speculation swept through dollar markets yesterday with whispers of Federal Open Market Committee Chairman Ben Bernanke's potential retirement, chatter about today’s Federal Reserve meeting and talk over when quantitative easing could be reined in. The result meant volatile conditions for the US dollar – moving quickly as it  strengthened against sterling but lost ground again against the euro. Disturbance in price levels is likely to continue today as we wait on Mr Bernanke to clarify his strategy for the US monetary stimulus programme going forward in this evening's press conference. Call your trader today to find out which way rates are trending ahead of this evening's announcements.

Worldwide

Yesterday the Australian dollar continued to struggle; declining against all of its 16 major trading partners off the back of monthly central bank meeting minutes being released. The minutes show the Reserve Bank indicating that the currency will weaken further - paving the way for further easing of borrowing costs. The currency fell most notably against the US dollar, as did the New Zealand dollar and the Japanese yen as markets anticipate the result of the US central bank meeting. The Russian rouble also had a poor day on Tuesday as crude oil, Russia's biggest export, dropped in price. Today we have the new Governor of the Bank of Canada making his first speech. As it is his first address, expect the markets to be particularly sensitive as he sets the tone for his monetary policy. We also have quarterly growth data coming out of New Zealand and Japanese trade balance figures this morning. Get in touch for rates and feedback on a busy Wednesday for global economic news. 

All quiet before Federal Reserve Wednesday | Smart Daily Currency Note

Sterling

A steady day for sterling yesterday, trading in a tight range against both the US dollar and euro as markets look ahead to today’s inflation figures. We anticipate an increase of 0.2% on last month's figure of 2.6% which means that it still way ahead of the Bank of England's 2.0% inflation target. The Governor and Members of the monetary policy committee will give evidence afterwards on inflation, interest rates and the economic outlook. The hearing lasts a few hours, so can create great volatility over that period of time. Call your trader today to find out which way rates are moving.

Euro

Euro trended in a narrow range yesterday against the USD and GBP, with little news out of Europe along with traders being cautious leading up to the Federal Open Market Committee projections and statement on Wednesday. Europe's trade surplus did narrow to €16.1 billion from €18.1 billion in March which was positive but the German Bundesbank did warn that signals showing a slowdown in growth in Europe are appearing.  Amidst this struggle for a return to growth, the European Central Bank (ECB) may be pressured to adopt more outlandish measures over the coming months. For example, we may see an increasing number of bank officials support a negative interest rate policy. Today all eyes will be on the ECBs President Draghi's speech along with German Economic Sentiment data. Throughout yesterday and today we have the G8 meetings taking place in the UK. Get in touch for the latest updates.

US dollar

Yesterday was a relatively quiet day for the US dollar as it traded within a narrow range against the euro and sterling. New York manufacturing data revealed conditions to be much more favourable than expected; although this had little impact on dollar performance as trading is likely to be more heavily influenced by events later in the week. Monthly figures illustrating the number of new building permits granted in the previous month are released today, giving an insight into future construction output. Furthermore, the monthly consumer price index, which gives an indication of inflation levels, is also released today and may prove to have an impact on trading ahead of the all-important Federal Open Market Committee (FOMC) statement which is due to be released on Wednesday. Call your trader now to see how markets react to the data released today and to get a live quote.

Worldwide

Yesterday we saw the Japanese yen drop against the majority of its 16 major peers. The slide was a response to stocks across the world performing well, triggering a sell-off from the safe-haven currency as traders looked to buy in to higher-risk, higher-yield markets. Similarly, we saw the Australian dollar, a high-risk currency, gain against all but one of its 16 main trading partners for the same reasons. The Canadian dollar had a strong day, trading at a one-month high versus its US counterpart amid significantly better-than-forecast Canadian bond-buying data. The data, which shows the number of bonds bought from overseas markets, is directly linked to currency demands. Today we see the release of monetary policy meeting minutes released by the Reserve Bank of Australia, as well as quarterly foreign trade data out of New Zealand. Eyes will also be on Northern Ireland for the G-8 meetings, which continue today. Get in touch for the latest rates.

Will UK data releases support sterling this week? | Smart Daily Currency Note

Sterling

UK economic data last week was limited and the main influence on global currency markets was the on-going discussion on whether or not the US would continue their programme of quantitative easing. A bit more light should be shed on this as we have the Federal Reserve meeting mid-week followed by their announcement of the meetings outcome. Here in the UK we have a range of different releases. Inflation for May is expected to come in slightly ahead of the previous month at 2.6% and retail sales figures for May are expected to have recovered from the fall of 1.3% in April. We also have the release of the minutes of the last meeting for the Bank of England monetary policy committee on Wednesday. Expectations are for no changes in the voting patterns from the last few minutes so anything different would have an immediate effect on sterling. So after a steady week last week we could see sterling moving quickly as the data releases move it one way or the other. Please call your trader for an update.

Euro

News from the Eurozone has been limited for the last few weeks. Probably helpful so that the powers that be can go about sorting out the mess of high unemployment and high debt, government and banking. The key data for release this week are the various purchase manager indices for manufacturing, construction and services. The expectation is for them to still be showing a contracting Eurozone economy albeit improved from the previous month. Recovery is going to continue to be slow. Call in now for the latest rates

US dollar

The US dollar made a modest recovery towards the end of last week after experiencing some poorer performance earlier on. Reasonable increases were seen against the euro, whilst gains made against the sterling during the early afternoon were largely cancelled out by the end of trading in London. The monthly US Producer Price Index, which reflects the change in price in finished goods and services, was higher than expected, encouraging notions of a slowing down in quantitative easing. Conversely, consumer sentiment data was revealed to be worse than expected and may have held the US dollar back from making further gains. Expect to see the dollar move considerably this week in response to upcoming events. Tomorrow sees the release of the monthly consumer price index, ahead of the release of a statement by the Federal Open Market Committee on Wednesday. The members will give their projections for economic performance over the next two years and more importantly they will detail their predictions for future interest rate alterations. Traders will be paying close attention as they look for anything that might hint towards a scaling back of the bond-buying scheme of the world's largest economy. Call in now stay up to date with market movements in what is sure to be a busy week. 

Worldwide

Elsewhere there is a raft of data being released with retail sales in Canada and industrial production in Japan. However one key decision will be whether or not the Indian Reserve Bank cuts their interest rates. Difficult as their economy is faltering and needs a boost but there currency is under pressure and as such a cut would weaken it further and result in increased import costs and therefore increasing inflation. Call in now to see how the rupee and other currencies are faring this week.

US dollar under pressure | Smart Daily Currency Note

Sterling

On the whole an okay week for sterling. It held its own against the euro, lost a little bit of ground against the commodity backed currencies; albeit midweek it had made significant gains, and gained throughout the week against the US dollar. It seems to be more of a case of what is happening elsewhere than any key UK event. Worries over quantitative easing in the US and Japan are having a significant effect on emerging markets and also on stock markets. There is limited UK data released today so again it will be a case of influence from elsewhere. Call in now to see how sterling is faring today.

Euro

The euro underwhelmed yesterday; losing nearly a cent against both sterling and the US dollar after what has otherwise been a strong week. Ground was steadily lost through the day as sterling once again tested the 1.18 level, and the euro dropped back below 1.33 against the US dollar. Today is as quiet as yesterday on the news front; will no news be good news? Call your trader now to find out if anything can buck this recent trend. 

US dollar

The US dollar has been under pressure this week as the debate on when the US will end their programme of quantitative easing dominates market thoughts. The Federal Reserve has made it clear that this is on the agenda and therefore it is just a matter of timing. This means that every piece of economic data released is examined in minutiae as commentators and investors try to forecast the likely start date. Yesterday’s retails sales data was more positive than expected which obviously helps the case for an early start date for Federal Reserve stopping their liquidity support. The key driver though will be employment and although it has stabilised we are still waiting to see a significant reduction in unemployment. Call now to see how the dollar is faring on the final day of the week.

Worldwide

Elsewhere, apart from a small slide on Wednesday morning, the Japanese yen has had a very strong week. This strong form continued throughout yesterday, concluding the largest three-day gains the yen has seen since 2008.  The catalyst for the yen strength this week has been a poor-performing Japanese stock market, which has led to nervous traders selling off stock and holding on to cash. The Canadian dollar has also had a good week, hitting a four-week high against its US counterpart yesterday. The strength was down to a run of positive data coming out of Canada, as well as a general consensus in the markets that the Canadian economy will have a good spell triggered by a healthy US economy.  After a difficult start to the week off the back of poor home loans data, the Australian dollar recovered yesterday follow better-than-forecast employment statistics. The New Zealand dollar had a fairly flat week, following the reserve bank's decision to keep interest rates fixed on Wednesday night.
Today we see Canadian manufacturing data released in the early afternoon. Get in touch to see if the results continue the Canadian dollar's rich vein of form. 

UK employment data boosts sterling | Smart Daily Currency Note

Sterling

A day of two halves for sterling yesterday, gaining nearly half a cent in the first two hours of trading as employment figures exceeded expectations. Markets reacted positively to the news, driving sterling briefly through the 1.18 mark against the euro. The momentum remained with sterling through the day against the US dollar, but it couldn't hold on to its gains against the euro, slipping back to the 1.175 levels. Today the excitement will come from elsewhere in the world as little news is expected from the UK. The key question will be, can sterling keep climbing against the US dollar - call your trader now to find out.

Euro

The euro experienced greater volatility yesterday in what was one of the more eventful days of the week. Following the better than expected UK employment data the euro weakened initially against sterling but pulled back later in the day. By the end of the day the single currency had marginally strengthened against the US dollar, despite a more shaky performance early in the day. The seventeen-nation currency may have been given a boost following the release of better than expected Eurozone industrial production figures, which showed a modest increase. The ECB monthly bulletin, which reveals the statistical basis of the Central Bank's most recent interest rate decision, is released today and may give some further insight into the economic state of the Eurozone. Call in now to stay up to date with market news and for a live rate.

US dollar

The US dollar had a bad day losing ground across the board. For emerging market currencies such as the South African rand and the Indian rupee this seems to have been a “correction” following the significant gains made by the US dollar over the previous two days. Worries over when the Federal Reserve will discontinue their bond buying programme were the driver for the previous day’s gains. Elsewhere there was a continuance of the short term trend of US dollar weakness. Today we have the release of US retail sales figures which should give further insight into the state of the US economy and the likelihood of a reduction in the bond buying programme. Call in to see how the US dollar is faring today.

Worldwide

Elsewhere, the South African Rand had a very poor day yesterday against sterling. After having been weakening fairly consistently over previous months due to a variety of global factors, the strong employment data out of the UK exacerbated the rand weakness, resulting in the lowest levels rand has seen against the pound since 2008. Yesterday we also saw the Australian dollar rebound from the 3-year lows we saw on Monday. The gains were down to better-than-forecast consumer confidence data showing a slight recovery in June. The Japanese yen had a difficult start to the day, falling against all of its 16 major counterparts amid rumours of further monetary stimulus from the Bank of Japan; however, we did see the yen recover slightly against the US dollar towards the end of the day. In New Zealand interest rates were kept on hold and the expectation is that they will be kept on hold for the rest of the year. Get in touch to see how the markets respond.

Sterling steady despite poor UK manufacturing data | Smart Daily Currency Note

Sterling

A fairly steady day for sterling yesterday in spite of disappointing manufacturing figures in the morning which showed contraction of 0.2% after two months of growth. Ground lost to the euro was regained in the afternoon with sterling finishing the day very close to the point it started against the euro. There was a similar result against the US dollar. A series of employment releases this morning will be the main driver for sterling today. The number of people claiming unemployment benefits is expected to have fallen from last month, a sign that recovery is moving forward. Call in today for a live price, and to find out how sterling is performing today.

Euro

Yesterday was a steady day for the euro as it saw little overall movement against sterling and the US dollar. Whilst there was little in the way of important data released yesterday, we did see the beginning of what could be an influential decision by the German Constitutional Court on the legality of the European Central Bank’s bond-buying scheme known as Outright Monetary Transactions (OMT). A ruling against the OMT would not bode well for the single currency as it would seriously hinder the scheme's effectiveness. Today will be the final day of the hearing and traders are likely to be watching developments closely, although a ruling is not expected until after the German election in September. Today also sees the release of monthly Eurozone industrial production figures, which have the potential to impact on the euro's performance during the day. Call in now to keep abreast of developments and get a live market rate.

US dollar

In what was a relatively quiet day across the currency markets the US dollar saw relatively little movement yesterday, losing a little bit of ground against sterling and holding steady against the euro. After gaining support from an increased rating from credit agency Standard & Poor earlier in the week, there was little by the way of influential information released yesterday. Today however, we can expect some reaction to the release of a variety of data. Crude Oil Inventories and the monthly Federal Budget Balance, which reveals the difference between income and expenditure by the Federal Government, both have potential to cause volatility if figures differ from expectations. Monthly 10-year bond yields released today could also have implications for US dollar performance. Call in now for a live rate and market updates.

Worldwide

Elsewhere, the Japanese Yen had a very strong day yesterday, gaining one percent gains against all of its 16 major peers. The Yen strength was a response to the Bank of Japan opting not to increase easing methods that have been so influential on the value of the currency in recent months. We also saw Japanese current account data coming in stronger than forecast. The Australian dollar had a weak day yesterday. Falling to the lowest levels seen in three months against its US counterpart. The Australian dollar's poor performance was down to a combination of worse-than-expected home loans approval data and speculation that the US will reduce stimulus this year, narrowing Australia's interest rate advantage. In contrast to the Australian dollar's poor day, the Canadian dollar - another of the heavily commodity-backed currencies - had a strong day, rising to its highest level in three years against the Australian currency. The strength seen was a result of market speculation that the North American economy will see some consistent growth, driven by a healthy US economy across the border. Tomorrow we see the Reserve Bank of New Zealand short term interest rate decision in the morning. Get in touch to see how the markets react.

Sterling steady before UK manufacturing data | Smart Daily Currency Note

Sterling

Having enjoyed a successful last few days, sterling traded slightly higher against the US dollar and slightly lower against the euro in what was a quiet start to the week for currency markets. There have been increasing signs that the British economy is recovering – not least due to rising house prices and positive data from the manufacturing, construction and service sectors. Investors will be looking to UK manufacturing production data emerging this afternoon to influence the market further, whereby more positive news will add to speculation that the UK's asset purchase programme could be reduced this year or at least not expanded further as Mark Carney takes over at the Bank of England. Talk to your trader now for all your currency requirements and reaction from the markets.

Euro

The euro performed well on Monday, regaining earlier losses against the US dollar as trade was largely confined to a tight range. European Central Bank leaders are still promising a modest recovery as the year progresses, though with on-going economic struggles the prospect of furthering the region's quantitative easing programme remains a possibility despite the French Prime Minister declaring the crisis to be over when speaking in Japan yesterday. Furthermore, as peripheral countries attempt to find purchase on a sustainable recovery, the ECB has not ruled out its willingness to impose negative interest rates if warranted. The German Federal Constitutional Court rules on the central bank's Outright Monetary Transactions policy over the next two days, with potentially serious consequences for the political stability of the union; call in as the week progresses for up-to-the-minutes prices on your transaction.

US dollar

General US dollar strength early on Monday was aided by rating agency Standard and Poor's upgrading the country's AA+ credit rating from negative to stable based on receding fiscal risks. A string of positive data recently has boosted the dollar's performance as the world's largest economy begins to take more significant steps towards economic recovery. One of the members of the Federal Open Market Committee suggested that the country's asset purchase facility would not be tapered back in the near future despite positive labour market data last week, pointing out that relatively low inflation data means that any tapering of the programme may be significantly delayed. How this new clarity from central bank members impacts the markets ahead of the interest-rate meeting taking place next week remains to be seen, with little significant data emanating from the US today. Call Smart now for up to date information and to see how the market reacts.

Worldwide

Elsewhere, poor Chinese data released over the weekend has pointed to further slowdown in the world's second largest economy as export growth stalled and imports fell. Industrial production is decelerating and with worse than expected retail sales activity, some predict the central bank may move to cut interest rates. India meanwhile is looking to encourage investors' interest in their sovereign debt by relaxing permit laws, though analysts argue that the government must take action soon with monetary and fiscal policy to aid the stuttering economy. The rupee fell in value sharply against both sterling and especially the US dollar where it reached record lows yesterday as the country battles with slowing growth figures, political instability and dwindling public finances. It was better news however for the Canadian dollar which forged ahead across the board after positive labour data before the weekend as new home building accelerated by the most in over a year. The Bank of Japan's monetary policy news will affect prices coming through this morning: call in for the latest developments with Smart.

Will sterling maintain its positive outlook? | Smart Daily Currency Note

Sterling

Sterling, having enjoyed a strong period last week following the release of positive figures across the manufacturing, construction and service sectors, weakened against the US dollar on Friday. Growing employment data from the United States forced the UK currency to retrace some of its gains from earlier in the week by around a cent and weakened for the first time in three days against the euro. Prices however were nonetheless supported by official figures showing the trade deficit to have narrowed more than expected in April, improving to 8.2 billion pounds. Speculation still grows that the Bank of England under the stewardship of Mark Carney will alter its quantitative easing strategy as the UK continues to avert a triple-dip recession. Some suspect he will implement a growth mandate alongside the existing 2% inflation target which could enable the bank to step up its asset purchase facility to meet the requirement and cause a sell-off in sterling, though the case for increased asset purchases has been weakened by UK data striking a positive note recently. Manufacturing Production figures emerge on Tuesday and the Claimant Count unemployment change report around midweek will give more of an indication of underlying strength, or lack thereof, in the economy; call in throughout the week for the latest rates and developments in sterling value.

Euro

German industrial production registered the best expansion for over a year before the weekend following sluggish construction output in part due to the long winter. Production activity in Europe's biggest economy grew 1.8% in April with Germany now charting consecutive growth figures for the sector. However, The Bundesbank however pared down its forecast for the economy on Friday, indicating an expectation for a slow but sustained recovery as trade balance data improved due to lucrative exports with Asia and the US. The European Central Bank is likely to adopt a neutral tone for monetary policy over the rest of the month and might be encouraged to consider furthering their quantitative easing designs later in the summer alongside fresh policy measures to deal with territories increasingly relying on monetary support. It will be a relatively quiet week for data directly regarding the single currency, though French Industrial Production figures and a German Constitutional Court ruling on its relationship with the ECB and its monetary transactions policy. Stay in touch throughout the week with Smart.

US dollar

The US dollar found support at the end of last week as Non-Farm Payrolls data detailed that employment levels had risen by slightly more than expected. Many were anticipating employment data from the US to show a decline following the reports released earlier in the week, but the Bureau of Labor Statistics detailed that 175,000 jobs had been added to the economy in May - a slight increase on predictions, although the overall unemployment rate rose by 0.1%. The US dollar strengthened in most of its major pairings, though gains were diluted as the Federal Reserve stated that it would maintain its bond buying programme until the labour market improves substantially. That would involve four consecutive months of job growth averaging at least 200,000 according to Chairman of the Federal Bank. Friday's data falls short of that mark, though the statement may help to provide more clarity and go some way as to settling previously feverish expectation as to when quantitative easing might be tapered back. Whilst midweek heralds the Federal Budget Balance report along with Industrial Production figures, important Retail Sales data on Thursday will precede the next University of Michigan Consumer Sentiment Report and PPI inflation figures. Many will be hoping the retail data will build on strong consumer sentiment in recent weeks as demand will be crucial in shepherding the world's largest economy further along the road to recovery.

Worldwide

Elsewhere, the Canadian dollar performed well on Friday after better than expected labour data was released. Other data released from Canada this week includes monthly manufacturing figures which are forecast to show a small improvement on last month's figures and traders will keep a close eye on this release following the Canadian dollar's strength before the weekend with the nation's strongest employment gains in more than a decade. Much focus early this week will be on Japan as the central bank make a statement on monetary policy on Tuesday. Markets will be looking to identify more definite action than Prime Minister made last week in his speech which sparked a drop in equity market values and Japanese yen strength as the currency moved back below the 100 mark against the US dollar. Later in the week the interest rate decision from New Zealand and employment figures from Australia are both released overnight on Wednesday. Currencies from both antipodean regions have dropped considerably in recent weeks and central banks from each currency are considering their monetary policy positions to deal with deepening economic problems. Be in touch with your trader throughout the week for information and prices from your currency pair.

Sterling has a good week | Smart Daily Currency Note

Sterling

Sterling has sailed upwards against most of its major counterparts this past week as Purchasing Managers Index figures exceeded expectations with the construction, manufacturing and now service sectors all expanding at better rates than expected. Yesterday the Bank of England opted to keep monetary policy on course for the time being with interest rates being left on hold at 0.5% - still a record low, whilst the UK's asset purchase programme has been left unchanged at 375 billion pounds. The UK currency found significant gains throughout Thursday against its US dollar counterpart as it broke through the 1.5600 level late afternoon to the highest point in 4 months. Indeed, this was the quickest gain against the dollar since 2009 as central bank Governor Mervyn King conducted his last policy meeting amidst a renewed sense of optimism surrounding the economy. With rising house prices sterling could still find support coming into next week – be in touch with all upcoming developments and live prices with your trader.

Euro

It has been a characteristically volatile week for the euro: with Cyprus' credit rating sinking deeper into junk bond territory as ratings agency Fitch downgraded the country to a B-minus and both Italian and Spanish service sectors continuing to contract whist Latvia was given the green light to adopt the single currency under pervading economic gloom surrounding the Eurozone. Indeed, earlier in the week Producer Price Index data described a contraction of 0.2% - the first reduction for over three years and speculation heightened that interest rates could be slashed again as the European Central Bank met yesterday. Borrowing rates however were kept level accompanied by central bank President Mario Draghi speaking out confidently that Europe's economy should start recovering this year and that there was no need to introduce additional stimulus for the time being. Euro's mirrored sterling by finding four-month highs against the dollar as the seventeen nation currency found support from reassured investors, though whether the region and currency values can remain positive in the longer term remains to be seen. Call in now to monitor progress and for any trading requirements coming into the weekend.

US dollar

The US dollar came under pressure this week after disappointing private sector employment figures diluted speculation that the Federal Reserve will taper back its quantitative easing programme this year. Gains in dollar value from strong Consumer Sentiment data from last week were relinquished as weak manufacturing sector figures and the disappointing report from payroll processor ADP fuelled uncertainty over the fate of quantitative easing ahead of today's key unemployment data release. The US currency traded lower yesterday against most of its major counterparts; dropping to four-month lows against both sterling and the euro. Benefit claims information yesterday however were shown to have having fallen, indicating businesses are gaining confidence demand will survive federal budget cuts. Attitudes surrounding the economy's recovery though have dampened slightly over recent days and much focus will be on Non-Farm Employment Change and Unemployment Rate figures as the Federal Reserve has identified the job market as key to influencing monetary policy this year. Talk to your trader as events transpire and for up to the second prices.

Worldwide

Elsewhere this week the Australian Dollar has had a torrid time; falling for a third day against its US counterpart on Thursday, the currency has been a clear underperformer in world currency markets recently and pressure is likely to keep building in the wake of worse-than-forecast national account figures emerging earlier in the week. The data sparked speculation over further interest rate cuts from already record lows, with some economists are even predicting two cuts in borrowing prices before the end of the year which would tap more value out of the currency. The Canadian dollar meanwhile, after a slow start to the week, performed well yesterday after the newly appointed Governor of the Bank of Canada gave his first address to lawmakers since taking office. Markets reflected his positive tone as he put confidence in Canadian export strengthening and oil prices recovering from recent dips in value. The Japanese yen also has also had a stronger week in response to equity markets falling. The selling off of stock saw the yen fall back below the hundred mark against the US dollar; a trend which accelerated yesterday with a bout of dollar weakness. Important employment statistics emerge from Canada later today – monitor progress in your currency pair with your dedicated trader going into the weekend. 

Positive economic data supports sterling | Smart Daily Currency Note

Sterling

Sterling sailed to a three-week and two-week high against the US dollar and euro respectively yesterday following the Purchasing Manager's Index for the UK Services sector showing the fastest rate of expansion for over a year. The UK currency found gains in all its major pairings as the report also noted new business to have increased at the quickest pace for over three years last month as better market conditions and fairer weather bolstered growth. Expectations are now intensifying that the Bank of England will keep their monetary policy strategy unchanged at their monthly meeting later today. Manufacturing, Construction and Service sector activity figures have all exceeded predictions this week, and in Mervyn King's last meeting before Mark Carney takes over the helm at the Bank of England economists are expecting the UK's asset purchase facility and interest rate level to stay constant as the economy has “all cylinders now firing” according to the Markit report. Keep on the pulse of the recent sterling surge throughout an important day today with Smart.

Euro

The euro was characteristically volatile during trading yesterday, responding to mixed economic reports emanating from the Eurozone. Not much overall change was seen against the US dollar, whilst the single currency weakened against a resurgent sterling as European service sector figures fell short of expectations and retail sales fell by 0.5%. Italian services data was weaker than expected and whilst Spanish service sector performance was slightly better both continued to contract amidst a deepening recessive climate. Meanwhile Latvia was given the green light to adopt the single currency despite concerns about its long term economic credentials. Looking forward to an important day the European Central Bank holds its monthly press conference this afternoon with the expectation being for the ECB to hold interest rates at the record low of 0.5%. Focus will be on the decision and press conference around lunchtime; monitor progress with your trader as events transpire.

US dollar

The US dollar had a varied day as markets reacted to the latest batch of data from the United States - whose service sector, according to the Purchase Manager's Index, expanded slightly above expectations in May though growth in factory order figures were disappointing and the US private sector added fewer jobs than hoped last month. The disappointing report from payroll processor ADP especially has fuelled uncertainty over the fate of quantitative easing as employment will be a key catalyst if the Federal Reserve's asset purchase programme is to be scaled back. The US currency stayed range bound against the euro and weakened in the face of strong sterling performance, though unemployment data released today and tomorrow will be crucial having been highlighted as a key influence over monetary policy going forward. The subdued pace of hiring however may indicate that employment may not be keeping pace with the rest of the recovery and experts remain split as to how soon monetary policy could be tightened. Call in for the latest developments.

Worldwide

Elsewhere, the Australian dollar struggled again yesterday as weak national account figures came in below expectations; sparking speculation over further interest rate cuts from already record lows. Some economists are even predicting two cuts in borrowing prices before the end of the year which would tap more value out of the currency. Interest rate cuts again were the catalyst for the Polish zloty losing ground as eastern Europe's largest economy battles with its worst slowdown in four years and borrowing costs at record lows. The Japanese yen strengthened yesterday however, moving back below the one hundred mark against the US dollar as stock prices in the region fell after the Prime Minister's speech underwhelmed the market by providing little extra detail on his quantitative easing strategy. Today we have the Governor of the Bank of Canada's speech after PMI figures are released; after the Canadian dollar dropped to the lowest levels this year yesterday the central bank is coming under increasing pressure to take action. Call your trader today for the latest news and rates for your currency trades.

Good construction data helps sterling hold steady | Smart Daily Currency Note

Sterling

Sterling traded within a narrow range yesterday during a relatively quiet period for the global foreign exchange market. The UK currency performed strongly against an under pressure Australian dollar and held steady against the euro and US dollar after trading at a three-week high against its American counterpart on Monday. Sterling was supported by the UK construction purchasing manager's index registering an expansion for the first time in 2013; growing beyond predictions to the highest level for eight months after having been expected to reveal a seventh straight month of contraction. Today sees the release of Purchasing Manager's Index data from the services sector, which accounts for around 75% of the UK economy, where further positive news would mean growth across all three sectors. With Mervyn King's final policy meeting as Bank of England Governor tomorrow and crucial Service sector figures emerging today, call Smart now to stay on top of market reaction and for the latest live rates.

Euro

The euro posted modest gains on Tuesday despite the Producer Price Index contracting by 0.2%; the first reduction for over three years. Nonetheless, recent rebounds in euro value are likely to be short lived coming up to the European Central Bank's interest rate decision and the pervading gloom surrounding Europe's economic prospects. Indeed, Cyprus' credit rating sunk deeper into junk territory as ratings agency Fitch downgraded the country to a B-minus – warning it could experience a deeper recession than expected. Speculation is rife as to whether the ECB President will start to exhibit an enhanced willingness to drop interest rates to new record lows and so traders will remain cautious ahead of tomorrow’s central bank meeting. Call in to see how PMI data and retail sales figures impact euro value throughout today.

US dollar

The US dollar largely recovered from weak manufacturing data released yesterday on the back of more speculation of an early unwind of quantitative easing. Figures yesterday afternoon showed the world's largest economy's trade deficit to have widened beyond expectations through April; up 8.5% to over 40 billion dollars. Many have taken the rebound in imports of consumer goods and business equipment especially to indicate strong domestic demand and accelerating growth in the economy - with the data pointing to gains in both household and business spending, whilst exports from a burgeoning American automotive industry are on the up. The job market report on nonfarm payrolls at the end of the week will be under significant scrutiny: it is expected to remain steady, though with the central bank's Chairman highlighting unemployment as a key influence on monetary policy, a swing in either direction away from expectations will impact price levels. Talk to your trader now through what will be a busy afternoon for US data.

Worldwide

Elsewhere, the Canadian dollar tapered off its strong performance from the start of the week as trade balance figures came out worse than forecast yesterday afternoon. The ailing export data was largely resultant from crude oil - Canada's biggest export, falling in value by a percent recently. The Canadian dollar's week will continue to be of interest, with building permit data being released tomorrow as well as Purchase Manager's Index and employment statistics later in the week. Down across the Pacific, the Australian dollar maintained its decline from Monday night into Tuesday as the Reserve Bank of Australia left its key interest rate steady at a record low amongst strong suspicion that monetary policy will be eased to protect the economy from an impending ceiling on mining investments. The Polish zloty had a strong day yesterday however, recording its biggest gains against the US dollar since December and jumping a percent in response to pro-stimulus data coming out of the US. Today, on top of the Canadian building permit data, we have Australian quarterly growth figures: call us on 0207 898 0500 for up to the minute rates with Smart.

Good manufacturing data boosts sterling | Smart Daily Currency Note

Sterling

Sterling moved upwards to a three-week high against the dollar as better than expected UK manufacturing figures boosted the UK currency yesterday. The British Purchase Manager's Index data emerged more positively than expected (at 51.3 instead of 50.2); the highest gauge of manufacturing activity in fourteen months. With the manufacturing expanding above estimates, chances are increasing that the Bank of England will hold off from instigating further action as it meets to discuss policy on Thursday when incumbent Governor Mervyn King chairs his final policy meeting. The UK currency has still performed poorly this year, and markets will be waiting to discover what impact Mark Carney can have when he takes over the helm at the bank. This morning sees the release of UK construction figures: be in touch with Smart to discuss whether sterling can maintain this upward momentum.

Euro

The euro relinquished recent advances against sterling yesterday as the European Central Bank President spoke about the challenges remaining for the region; reiterating that the economic situation remains unhealthy and that monetary policy alone cannot make up completely for structural reform. Manufacturing in Europe yesterday however was shown to be contracting at a slower pace than anticipated, and in contrast to US data the single currency strengthened against the US dollar late on but lost ground to a strong sterling. Interest rates in Europe are anticipated to be kept steady at record lows on Thursday, though the central bank will be trying to conjure less standard measures to stimulate growth as many governments become increasingly reliant on monetary support. Track euro price levels throughout today as Spanish Unemployment data emerges by calling your trader.

US dollar

The US dollar weakened throughout yesterday afternoon in most of its major pairings following downbeat manufacturing figures. The Institute for Supply Management unveiled its manufacturing index fell through April along with new orders and employment. - the first contraction since November. The weak figures have helped to dilute on-going speculation of whether the Federal Reserve will taper back its quantitative easing initiative later on this year, though positive sentiment surrounding the currency is unlikely to wane ahead of the next Federal Open Market Committee interest rate decision later this month. Indeed, the San Francisco Federal Bank President yesterday commented that the US asset purchase facility could be reduced as early as this summer, and as a growing number of central bank officials reduce their willingness to keep expending the balance sheet we may see the US currency strengthen into the summer months. We saw the US dollar’s ability to weather negative data last week, so with important Trade Balance figures emerging this afternoon call in for the latest information and help with your trading requirements.

Worldwide

Elsewhere, following a turbulent week of demonstrations in the country the Turkish lira prices crumbled as the public hit out at the current government. The currency fell for a fifth day to seventeen-month lows as riots erupted in Istanbul and Ankara. The Prime Minister, having left the country, is showing no signs of backing down however and the region faces a difficult summer with lira prices already suffering at the potential for tighter US monetary policy. Elsewhere, the Australian dollar rebounded following signs that the economic slowdown in China is bottoming out, whereby economists expect the Reserve Bank of Australia to keep interest rates at record lows of 2.75%. The South African rand similarly enjoyed a resurgence after being oversold heavily the past few days; appreciating against all of its major counterparts with a report showing manufacturing to have grown unexpectedly last month; whether Africa's largest economy can recoup more of recently sustained losses remains to be seen. Overnight we saw the  Reserve Bank of Australia’s interest rate decision and later on today the main release will be the Canadian trade balance data. Stay on top of the latest developments worldwide with Smart throughout the week. 

Busy week for sterling as Mervyn King says goodbye | Smart Daily Currency Note

Sterling

Sterling held firm against the euro before the weekend; however, tumbled against the US dollar by over a cent following positive data released in the US. On Friday the Bank of England described that net lending to individuals had increased in April further than expected; rising to £1.4billion from £1.1billion the previous month, though expectations the central bank could still loosen monetary policy could dilute sterling gains over the coming months. The Bank of England meet this week in what will be the last such meeting for Governor Sir Mervyn King before Mark Carney takes over in July, as a result, it would be a surprise if there is any change to the base interest rate level or the current asset purchase facility. Other key releases this week will be the Purchasing Managers' Index (PMI) figures for the Services, Manufacturing and Construction sectors. Call in now for the latest updates and to see how sterling is performing.

Euro

The euro extended losses against a strong US dollar on Friday afternoon, with the single currency under pressure after data revealed the unemployment rate in the euro zone climbed to record highs 12.2% in April. Though the jobs figures were in line with expectations, euro weakness was furthered by reports showing German retail sales to have fallen last month; confounding expectations for a slight increase. The euro could lose ground as we approach the latest European Central Bank decision this week as expectation regarding an increase in monetary stimulus increases. Indeed, the deepening recession in the region has rendered many member countries increasingly reliant on monetary support and we may see an increasing number of officials calling for negative interest rates if price stability continues to be jeopardised. Alongside the central bank decision, other important releases includes retail sales figures, Eurozone PMI and a 10-year Spanish bond auction. Call your trader now for a live quote.

US dollar

The US dollar performed well on Friday as positive consumer sentiment and purchasing data emanating from the US meant expectations in the markets swung back towards the Federal Reserve reducing quantitative easing sooner rather than later. The University of Michigan's consumer sentiment index rose above expectations in May, whilst the Chicago purchasing manager's index also surprised by increasing well above predictions. This was all in spite of United States personal spending figures falling by 0.2% in April and indicates the recovery across the Atlantic can weather negative economic data going forward. Consumer spending surprised economists by shrinking along with Household Purchases as incomes in the world's largest economy decrease, though house price rises along with cheaper fuel costs and a buoyant equity market are underpinning public confidence: crucial in seeing the recovery through going forward. Data released out of the US this week includes manufacturing and non-manufacturing PMI figures, trade balance data and a raft of unemployment data which includes the highly influential non – farm payroll data which will be announced on Friday and is always watched extremely closely by investors. Get the latest news by calling in.

Worldwide

Elsewhere, the Canadian dollar struggled on Friday as commodities prices fell in spite of data released showed that GDP rose by more than expected demonstrating 0.2% growth. The South African rand fell to a four-year low on Friday as traders speculate that the central bank could look to intervene in the market alongside data showing that the trade deficit was greater than anticipated. Overnight we saw the release of key retail sales data from Australia and later on this week we have more data from Australia including trade balance figures and the Reserve Bank of Australia (RBA) decision on interest rates. There is also a raft of data from Canada trade balance data, building permits figures, unemployment data and PMI figures. Call in now for the latest updates from your trader today.