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Posted January 17th, 2011 by Charles Purdy

Daily Currency Note

EURO/GBP - 1.1937
US$/GBP – 1.5863
CHF/GBP – 1.5302
CAN$/GBP – 1.5687
AUS$/GBP – 1.6026
ZAR/GBP – 11.0125
JPY/GBP
– 131.492
HKD/GBP – 12.3171
NZD/GBP – 2.0604
SEK/GBP – 10.5800
US$/EURO – 1.3291

Sterling had a strong finish to the week, closing at a 1 month high against the US dollar after speculation over a UK interest rate hike helped boost the pound. Higher than expected producer prices, that came in at 4.2% against an expected 3.9%, gave further reason for investors to expect an interest rate hike from the Bank of England sooner rather than later as inflation remains stubbornly high. Sterling also strengthened against the euro despite speculation that the European Central Bank might also need to raise interest rates sooner rather than later. However, given the current situation in the euro zone, talk of interest rate rises seems a little premature. This week sees some key data releases – inflation on Tuesday, unemployment on Wednesday and ‘official’ retail sales data on Friday. Call in now for a live exchange rate.
 
In the euro zone, it seemed the region breathed a sigh of relief at the close of a turbulent week for the euro. Successful bond auctions from Portugal and Spain saw the euro strengthen by 3.8% against the US dollar on the week – the best performance for 1 ½ years – as fears eased over the credit crisis in the region. Many analysts starting getting a little euphoric and talking about a euro rally towards $1.50/€1, but there are some serious issues in the region that cannot be fixed by 1 or 2 successful bond auctions. A meeting of EU finance ministers kicks off today, with many sceptical that a quick fix to the situation will be found. Watch this space, as a minor spark could see somebody heading to the EU and IMF for a bailout again…
 
In the USA, it is set to be an interesting week ahead. Chinese President Hu Jintao is set to meet Barack Obama for a summit in Washington this week. The discussions are almost guaranteed to revolve around currency and global trade. China has come under pressure from the USA in recent months over the pegged exchange rate that has kept China’s exports artificially cheap – clearly US manufacturers have been getting a little ‘hot under the collar’, so the discussions should be interesting.  

Elsewhere, with floodwaters still causing havoc, Australian inflation slowed to3.8% in December according to an estimate by TD securities and New Vehicle Sales fell by 3.1% in the month too. There is potential for a sterling recovery against the Aussie dollar so get in touch now for a live exchange rate.

For more information on Smart Currency Exchange, please call our freephone: 0808 163 0102 (+44 (0)207 898 0541 from outside the UK) or visit our website at: SmartCurrencyExchange.com 

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Posted January 14th, 2011 by Charles Purdy

Daily Currency Note

EURO/GBP - 1.1777 
US$/GBP – 1.5834
CHF/GBP – 1.5227
CAN$/GBP – 1.5722
AUS$/GBP – 1.5887
ZAR/GBP – 10.8070
JPY/GBP
– 130.521
HKD/GBP – 12.3171
NZD/GBP – 2.0604
SEK/GBP – 10.5800
US$/EURO – 1.3448
 

Sterling fell against a stronger euro yesterday, but hit a 1 month high against the US dollar helped by speculation that UK interest rates may rise sooner than expected and following weaker than expected US data. With the Bank of England keeping interest rates on hold at record lows of 0.5%, many feel that consistently high inflation will pressure the central bank to raise interest rates later this year. The minutes from yesterday’s meeting are due on January 26th and will be watched very closely for any sign of the Committee’s intent. Sterling fell against the euro after a strong Spanish bond auction and positive comments from ECB President Jean-Claude Trichet sparked investors to cover short positions by buying back euros that had been sold. Manufacturing data beat expectations, coming in at 0.6% against an expectation of 0.5%. In terms of data, there is key producer price inflation today which will give interesting insight into inflation for the rest of the year.
 
In the euro zone, the euro jumped 1% against the US dollar and sterling as ECB President Jean-Claude Trichet issued a warning about short term inflationary pressures in the region. A Spanish bond auction went far better than expected and helped ease concerns that Spain would join Ireland, Greece and possibly Portugal in the bail out club. Today there is European inflation data for the year so call in now for a live exchange rate.
 
In the USA, poor US data helped see the euro strengthen by 1% against the US dollar. Figures showed 445,000 new claimants for unemployment insurance against an expectation of 400,000. In addition, food and energy costs saw producer prices rise and indicated fresh headwinds for an economy that had started to show signs of a fresh recovery. However, a rise in exports helped reduce the US trade deficit in November. Out today we have consumer price inflation and retail sales figures, so speak to a trader for a price.

Elsewhere, an emergency meeting of Swiss trades union and industry representatives triggered heavy selling of the Swiss franc and saw it drop to the lowest level since mid-December. Have a great weekend.

For more information on Smart Currency Exchange, please call our freephone: 0808 163 0102 (+44 (0)207 898 0541 from outside the UK) or visit our website at: SmartCurrencyExchange.com

Posted January 13th, 2011 by Charles Purdy

Daily Currency Note

EURO/GBP - 1.1987
US$/GBP – 1.5733
CHF/GBP – 1.5314
CAN$/GBP – 1.5531
AUS$/GBP – 1.5827
ZAR/GBP – 10.7618
JPY/GBP
– 130.689
HKD/GBP – 12.2371
NZD/GBP – 2.0600
SEK/GBP – 10.6214
US$/EURO – 1.3120

Sterling strengthened to near a 1-month high against the US dollar yesterday following strong buying by Asian sovereign accounts. This helped offset an earlier drop caused by poor UK data. Figures released showed that the UK trade deficit widened to £8.736bn in November – £0.4bn more than expected and the highest trade deficit since records began in 1980. The data saw sterling drop marginally against the euro and US dollar but it was well supported by large purchases of sterling from Asia and Russia. Tomorrow is a busy day for data; with manufacturing production figures and the first Bank of England interest rate decision of the New Year. Policy is not expected to change, but investors will keep a close eye on the minutes of the meting hen they are released in 2 weeks time.

In the euro zone, the euro posted gains against the US dollar and sterling after a key Portuguese bond auction went slightly better than expected and news emerged that many investors believe the European Union will add further funds to the emergency bailout fund. Whilst the euro performed well, it was simply a  reaction to the auction not being as bad as expected – specifically the yield that Portuguese government needs to pay on the debt, which came in at 6.7% against an expectation of above 7%.  The upshot is that the crisis is by no means over. Today sees the ECB interest rate and press conference, so call in now for a live exchange rate.

In the USA, the Federal Reserve’s ‘Beige Book’ (a report on the economy based on anecdotal reports across the country) painted an increasingly upbeat but cautious picture for the US economy going into 2011. Economic activity grew moderately in November and December, and with employment picking up the US could slowly be turning around. There is unemployment claims numbers released today and trade balance figures.

Elsewhere, the Chilean government finally took the plunge and intervened in the foreign exchange markets to stem the rampant strength of the Chilean peso. The government bought large quantities of US dollars, but this had little effect as strong copper prices (Chile’s major export) drove a demand for the peso and saw it strengthen 1% against the US dollar on the day.

For more information on Smart Currency Exchange, please call our freephone: 0808 163 0102 (+44 (0)207 898 0541 from outside the UK) or visit our website at: SmartCurrencyExchange.com

 
 

 

 

Posted January 12th, 2011 by Charles Purdy

Daily Currency Note

EURO/GBP - 1.2010
US$/GBP – 1.5655
CHF/GBP – 1.5209
CAN$/GBP – 1.5462
AUS$/GBP – 1.5796
ZAR/GBP – 10.6921
JPY/GBP
– 129.988
HKD/GBP – 12.1716
NZD/GBP – 2.0572
SEK/GBP – 10.6444
US$/EURO – 1.3026

Sterling held firm above the €1.20/£1 level after jumping to a four month high in the last few days as sovereign debt concerns continued to punish the euro and expectations of an interest rate hike in the UK gave sterling a boost, despite a survey by the British Retail Consortium showing that sales dipped 0.3% in December on the same period in 2010. Euro weakness drove the price movement ahead of an important bond auction for Portugal which could see the country head to the IMF and EU if they struggle to raise enough funds. With Thursday’s UK interest rate decision in focus, many analysts feel that the UK is set to see an interest rate hike much sooner than expected. However, there are commentators that feel a hike in response to market pressure could be too early and it could damage already fragile growth. It is a quiet day for UK data again tomorrow, so call in now for a live exchange rate. 

In the euro zone, the euro saw a brief respite from heavy selling after Japan pledged to buy euro zone bonds in an attempt to stabilise debt markets. However, the respite soon wore off and the single currency suffered ahead of a key bond auction tomorrow. Portugal is set to raise €1.25bn in an auction that will signal whether the country will be able to afford the interest demanded by investors or it will need to seek a bailout from the EU/ IMF. This is going to cause some volatility, so call in now for a live exchange rate.  

In the USA, the US dollar strengthened against the euro yesterday following the concerns over the euro zone debt auction tomorrow, with the euro hitting a low of $1.2905/£1. The US dollar was yet again buoyed by a strong stock market performance after above forecast earnings from Aluminium Company Alcoa led the index higher. This boosted expectations for the rest of the 4th Quarter earnings season, so call in now and ensure you don’t lose out due to poor exchange rates.

Elsewhere, a top US business group has said that the US should not push China for an immediate sharp change in the Chinese yuan exchange rate as this could be detrimental to both countries. The group argue that a gradual change in the exchange rate will help address global balances in the exchange rates.

For more information on Smart Currency Exchange, please call our freephone: 0808 163 0102 (+44 (0)207 898 0541 from outside the UK) or visit our website at: SmartCurrencyExchange.com

 

 

 

Posted January 11th, 2011 by Charles Purdy

Daily Currency Note

EURO/GBP – 1.2015
US$/GBP – 1.5552
CHF/GBP – 1.5092
CAN$/GBP – 1.5425
AUS$/GBP – 1.5788
ZAR/GBP – 10.6130
JPY/GBP – 129.25
HKD/GBP – 12.099
NZD/GBP – 2.0474
SEK/GBP – 10.677
US$/EURO – 1.2940 

Sterling hit a 4-month high against the euro yesterday as the single currency was dogged by concerns over the debt problems in the euro zone.  Sterling was also helped against the euro as many (including PM David Cameron) believe inflation is too high in the UK and as such the Bank of England will need to raise interest rates sooner than expected, but the Bank is expected to keep rates on hold this Thursday in the first meeting of the year.  The pound suffered against the US dollar after figures showed that house prices fell by 1.6% in the year to December – the biggest drop since November 2009. Out today there is consumer confidence, so call in now for a live exchange rate.
 
In the euro zone, the euro suffered after a senior source was quoted saying that euro zone countries were piling the pressure on Portugal to seek financial aid from the European Bank and the International Monetary Fund in order to stem the risk of ‘contagion’ spreading to other countries in the region. This led to the single currency falling to a 4 month low against both the euro and US dollar but it did stage a slight rally towards the end of the day as ‘short sellers’ (i.e. those selling the currency and buying back at a lower price for profit) closed out positions at profit. Despite this recovery, the euro is set to remain under significant pressure so speak to a trader to get the best price – especially if you are moving euros into sterling anytime soon.
 
In the USA, the US dollar hit a 4 month high of $1.29/€1 and regained ground lost against sterling on Friday. As ‘earnings season’ kicked off on Wall Street (where companies announce corporate earnings to the stock market), the US markets had strong expectations and as such shook off any worries related to Europe. It is quite a quiet day for data so call in for a live price to avoid any unexpected movements. 

Elsewhere, the Chilean peso and Brazilian real suffered in risk related selling following the crisis in the euro zone. ‘LatAm’ currencies, as they are known, correlate closely with risk appetite and a poor performance from the euro sees the South American currencies suffer.

For more information on Smart Currency Exchange, please call our freephone: 0808 163 0102 (+44 (0)207 898 0541 from outside the UK) or visit our website at: SmartCurrencyExchange.com

 

 

Posted January 10th, 2011 by Charles Purdy

Daily Currency Note

EURO/GBP – 1.2028
US$/GBP – 1.5508
CHF/GBP – 1.4963
CAN$/GBP – 1.5443
AUS$/GBP – 1.5637
ZAR/GBP – 10.6130
JPY/GBP – 128.98
HKD/GBP – 12.059
NZD/GBP – 2.0421
SEK/GBP – 10.744
US$/EURO – 1.2889

Sterling had a strong day on Friday, closing above 1.20 against the euro after the biggest weekly gain against the single currency since mid-November 2010. Sterling benefitted from heavy selling of the euro as concerns over the debt crisis increased. After weaker than expected services and construction data earlier in the week, sterling took advantage as borrowing costs for Portugal, Spain and Italy went up ahead of an important week for European Government borrowing. It is a quiet start for data in the UK this week before the Bank of England’s interest rate meeting on Thursday. Whilst inflation is still stubbornly high and markets are expecting an interest rate hike at some point, this is unlikely to happen this week as the Bank will probably wait and see what impact the VAT increase and spending cuts has before changing current policy. Speak to one of the traders today about your upcoming payments.

In the Euro zone, a large sell off of European ‘periphery’ bonds, an EU proposal on lending and poor German retail sales data saw the euro slump to a 4 month low against the US dollar and drop below 1.20/ £1 against sterling. The EU proposal outlined plans to force those who lend to banks to accept losses should the banks fail and insurance against default for Spanish and Portuguese neared record highs. Analysts said there is scope for further euro losses this week so call in now for a live exchange rate – especially as the news overnight is that Portugal is now under pressure to accept a bailout. 

In the USA, following better than expected private jobs figures on Wednesday, there were expectations of big numbers on the Non-Farm payroll data. However, this failed to materialise but 103,000 new jobs were added and the unemployment level fell to 9.4%. The US dollar fell marginally against sterling. Out this week, there is further unemployment data on Thursday so call in now.
 
Elsewhere, it seems that investors have finally woken up to the realization that the Australian economy is not an invincible bastion to keep throwing money at. The worst flood in half a century and active efforts by China to curb growth mean that Australia’s export of commodities is likely to suffer. There are employment figures released this week which could come in worse than expected and kick start the Aussie dollar on a downward spiral. 

For more information on Smart Currency Exchange, please call our freephone: 0808 163 0102 (+44 (0)207 898 0541 from outside the UK) or visit our website at: SmartCurrencyExchange.com
 

 

Posted January 7th, 2011 by Charles Purdy

Daily Currency Note

EURO/GBP - 1.1885
US$/GBP – 1.5434
CHF/GBP – 1.4895
CAN$/GBP – 1.5422
AUS$/GBP – 1.5566
ZAR/GBP – 10.506
JPY/GBP
– 129.00
HKD/GBP – 12.002
NZD/GBP – 2.038
SEK/GBP – 10.596
US$/EURO – 1.2981
 

Sterling had a shaky start to the day yesterday, falling against the US dollar and euro following worse than expected data for UK services sector activity for December. However, sterling recovered from the early knee-jerk drop as the poor figures were attributed to the prolonged disruption that December’s snow caused in the UK. As a result analysts dismissed the figures (that showed service sector activity at the lowest since April 2009) as a seasonal anomaly due to winter weather. The UK is still in a very strong position moving forward especially against the euro – a fact demonstrated by the fact that sterling jumped 0.85% to €1.1899/£1 despite the day’s negative data as investors would rather hold sterling than euros. Out today, there is no real UK data released, so call in now for a live exchange rate – especially as there seems to be a steady exodus from holding the euro.
 
In the euro zone, the problems persisted for the single currency, with the euro falling by 1% to a 5 week low of $1.3013/€1 against the US dollar following Wednesday’s better than expected US employment figures. The euro did see a brief boost following reports that China was looking to buy around €6bn of Spanish government debt, however the currency did not react at all to news that economic sentiment in the region jumped in December. There is a wide range of European data released today along with some important US figures, so make sure you protect yourself from any volatility by speaking to a member of the team sooner rather than later.
 
In the USA, the US dollar continued to benefit from Wednesday’s ADP non-farm payroll figures that showed nearly 200,000 more jobs were added to the economy than was expected last month. Today we see the Bureau of Labor Statistics ‘official’ non-farm payroll reading, so numbers either side of the 140,000 new jobs that are expected by analysts will see some movement. However, any dollar gains are likely to be limited by the fact that the Fed feels current economic conditions do not warrant a scaling back of the $600bn quantitative easing package in place.

Elsewhere, the Brazilian real slumped yesterday after the central bank imposed reserve restrictions on banks’ foreign exchange positions in a bid to weaken the currency and keep Brazilian exports competitive.

For more information on Smart Currency Exchange, please call our freephone: 0808 163 0102 (+44 (0)207 898 0541 from outside the UK) or visit our website at: SmartCurrencyExchange.com

 

 
Posted January 6th, 2011 by Charles Purdy

Daily Currency Note

EURO/GBP - 1.1830
US$/GBP – 1.5540
CHF/GBP – 1.5017
CAN$/GBP – 1.5435
AUS$/GBP – 1.5550
ZAR/GBP – 10.455
JPY/GBP
– 129.06
HKD/GBP – 12.084
NZD/GBP – 2.045
SEK/GBP – 10.534
US$/EURO – 1.3133

Sterling fell against the US dollar yesterday as poor UK data contrasted with better than expected US economic data. Sterling dropped by 0.6% to a low of $1.5452/£1 after a PMI survey of construction purchasing managers showed that activity in the sector fell by more than expected. With the poor weather in December, a drop in construction activity should not come as too much of a surprise but yesterday’s fall against the US dollar highlights the fragility that investors feel is facing the UK economy as the VAT hike and government austerity measures take effect. Sterling gained against the euro as, despite poor construction activity, the UK economy is showing a resilience that makes it a far more attractive proposition than the euro – especially given the debt crisis in the region that could cause further issues. Out today in the UK, we have services sector activity and a report on credit conditions from the Bank of England so get in touch now to ensure you get the best price.

In the euro zone, the single currency continued to be hampered by concerns over debt in the region and fell by 0.6% against the US dollar and 0.5% against sterling. News that the Swiss National Bank had stopped accepting Irish bonds as collateral dented sentiment towards the euro, and Portugal came under increasing pressure from international debt markets amid concerns that the country would be forced to accept a bailout akin to Ireland and Greece. Out today there is retail sales data and German factory order data so speak to one of the team now for a live exchange rate.
 
In the USA, figures showed that new orders from US factories rose unexpectedly in November and minutes from the Federal Reserve’s FOMC interest rate meeting showed that the Fed is content to remain loose with monetary policy. Data showed that the US economy added 297,000 jobs in December which added to an already strengthening US dollar. Many analysts remarked that the US recovery feels more genuine and not just driven by stimulus money, so call in now in case it adversely impacts your pending payments.

Elsewhere, the Australian dollar continued to suffer as the floods caused concern amongst analysts. Some analysts believe that mining operations in Queensland will be shut down for 2-3 months as the flood waters subside. With the Australian economy heavily dependant on commodities trading, this is likely to be a major blow.

For more information on Smart Currency Exchange, please call our freephone: 0808 163 0102 (+44 (0)207 898 0541 from outside the UK) or visit our website at: SmartCurrencyExchange.com

 
Posted January 5th, 2011 by Charles Purdy

Daily Currency Note

EURO/GBP - 1.1770
US$/GBP – 1.5609
CHF/GBP – 1.4857
CAN$/GBP – 1.5602
AUS$/GBP – 1.5568
ZAR/GBP – 10.476
JPY/GBP
– 127.95
HKD/GBP – 12.125
NZD/GBP – 2.037
SEK/GBP – 10.504
US$/EURO – 1.3254

Sterling gained yesterday as manufacturing data showed that activity in the sector grew in December at the fastest rate in 16 years. The Purchasing Manager’s Index (a survey in which purchasing managers are asked about their company’s buying) shot to 58.3 – the highest since September 1994 and beating expectations of a figure of 57. Clearly this shows that the necessary shift is taking place in that the UK economy is moving from an economy driven by consumer debt and credit to an economy that actually produces tangible products, and as such it was a positive day for sterling. The pound was up by around 1% against the US dollar and euro, hitting a high of $1.5643/£1 and breaking back over the €1.17/£1 mark after hitting 7 week lows against the euro last week. Out today, there is construction activity data which could provide a boost if it beats expectations. Call in now for a live exchange rate.

In the Eurozone, the euro fell from 3 week highs against the US dollar yesterday after stronger than expected US manufacturing figures gave traders no reason to hold the single currency. In addition, many investors are concerned over bond issuance in the region as January is notoriously a time when many countries push through a large percentage of their debt funding requirements for the year to ‘front load’ their borrowing. Given the current climate, countries such as Portugal and Spain will have to pay more and more for their debt potentially pushing them towards a similar funding to Ireland and Greece. It will certainly be an interesting month so get in touch with one of the team now to ensure you don’t lose out.

In the USA, data showed that new orders received by factories rose to the highest level in 8 months in November that fuelled risk appetite and saw the US dollar surge against the euro. A 3% drop in crude oil prices saw the US dollar outperform commodity linked currencies. Out today, there is non-manufacturing PMI data and employment figures so there could be some interesting movement. Get in touch now for an exchange rate.

Elsewhere, the Australian dollar fell following the widespread flooding in a key industrial region. There were concerns that the flooding would impact industry and severely impact the economic growth, so call in now for a live exchange rate.

For more information on Smart Currency Exchange, please call our freephone: 0808 163 0102 (+44 (0)207 898 0541 from outside the UK) or visit our website at: SmartCurrencyExchange.com

Posted January 4th, 2011 by Charles Purdy

Daily Currency Note

EURO/GBP - 1.1631
US$/GBP – 1.5529
CHF/GBP – 1.4633
CAN$/GBP – 1.5427
AUS$/GBP – 1.5404
ZAR/GBP – 10.331
JPY/GBP
– 127.62
HKD/GBP – 12.068
NZD/GBP – 2.0199
SEK/GBP – 10.420
US$/EURO – 1.3352

Happy New Year! In our first currency note of 2011, sterling started the week slowly as UK markets were shut for the bank holiday. Sterling had a volatile end to 2010, dropping sharply on Thursday against the euro to hit 7 week lows which was attributed to heavy ‘year-end’ euro buying. The pound steadied on Friday though and gained against the US dollar after a house price survey by Nationwide showed that house prices rose by 0.4% in December against an expectation of a 0.3% drop. Data showed a 0.6% drop in November and as a result, many remain very cautious about the UK’s outlook for 2011. Today marks business as usual after the holiday period, and there is key manufacturing and lending data so call in now for a live exchange rate.

In the Eurozone, with much of the region closed for the New Year bank holiday yesterday, the euro took the lead from the US dollar falling by 0.6% against the US currency. The single currency gave back most of the gains it made last week against the US dollar after an article in the Daily Telegraph left many traders selling the euro after it claimed that Europe could face another debt crisis within months. There is German unemployment data released today, so call in now for a live exchange rate.

In the USA, in the country’s first trading day of 2011 there was an air of optimism on the markets. Manufacturing figures showed acceleration in production for December showing an increase for the 17th month in a row. Investors felt happier taking risk also after data showed that manufacturing data slowed in China and India that eased concerns over possible overheating in the region. Call in now for a live exchange rate to ensure you get the best price.

Elsewhere, the Brazilian real closed at the highest level since September 2008 yesterday, boosted by optimism over the global recovery that saw investors put money into the high yielding currency. It shows that the emerging market currencies are likely to see similar volatility to last year so ensure you are adequately protected by speaking to one of the team sooner rather than later.

For more information on Smart Currency Exchange, please call our freephone: 0808 163 0102 (+44 (0)207 898 0541 from outside the UK) or visit our website at: SmartCurrencyExchange.com

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