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Posted March 17th, 2011 by Charles Purdy

Daily Currency Note

EURO/GBP - 1.1503
US$/GBP – 1.6061
CHF/GBP – 1.4519
CAN$/GBP – 1.5892
AUS$/GBP – 1.6337
ZAR/GBP – 11.3727
JPY/GBP
– 127.12
HKD/GBP – 12.5274
NZD/GBP – 2.2197
SEK/GBP – 10.3488
US$/EURO – 1.3955
 

Sterling slipped against the US dollar yesterday as concerns over the UK economy and worries over the Japanese nuclear crisis dented the pound. The OECD also cut its expectations for UK growth citing falling house prices, weak domestic consumption and uncertain global demand. There was some positive data in the form of the unemployment claimant figures that unexpectedly showed that 10,000 fewer people claimed unemployment benefits in the last month which was nearly 12,000 better than was expected. Out later today, we have consumer inflation expectations which could see some volatility so call in now for a live exchange rate.
 
In the euro zone, the euro fell against sterling and the US dollar as Portugal’s credit rating was downgraded late on Tuesday night by rating agency Moody’s. In addition, a cooling of rate expectations nudged the euro downwards as ECB policymaker Christian Noyer cast doubts on expectations by stating that the bank would take stock of events in Japan before making a decision. It is a quiet day for data tomorrow, but the volatility in the market means that anything could happen so call in now for a live price.

In the USA, the US dollar sank to a 16 year low against the Japanese yen driven by ongoing concerns over the damaged nuclear reactor in the earthquake and tsunami stricken country. However, markets expect that the Japanese central bank will intervene to prevent any further appreciation in order to keep Japanese exports at competitive prices. There is a wide array of data released today in the USA, so call in to ensure you don’t lose out.
 
Elsewhere, the Swiss franc moved towards record levels against the US dollar as investors scrambled for refuge amid turmoil in the Middle East and Japan. Concern over violence spreading to Saudi Arabia sparked fresh concern yesterday. Call in now for a live exchange rate. 

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Posted March 16th, 2011 by Charles Purdy

Daily Currency Note

EURO/GBP - 1.1517
US$/GBP – 1.6086
CHF/GBP – 1.4778
CAN$/GBP – 1.5797
AUS$/GBP – 1.6180
ZAR/GBP – 11.2300
JPY/GBP
– 130.178
HKD/GBP – 12.5406
NZD/GBP – 2.1894
SEK/GBP – 10.3121
US$/EURO – 1.3962

Sterling fell across the board yesterday as fears of a nuclear crisis in Japan led investors to sell off holdings in ‘riskier’ currencies and expectations of a rate hike in the UK were pushed back. Against the euro the pound slipped below 1.15/£1 for the first time since November as markets priced in a 0.25% interest rate hike in either August or September. Last month, expectations were for a May or June hike and the change of sentiment has hurt sterling. Despite the UK’s AAA credit rating being reaffirmed recently, sterling holdings are higher yielding than the yen, US dollar and Swiss franc and as such are seen as ‘high risk’. When markets panic in the wake of nuclear explosions, tsunamis and Middle East turmoil only the safest of currencies will do. Stay in touch as there is a lot of volatility.
 
In the euro zone, financial markets also cut their expectations of a European interest hike later in the year as stock markets suffered and turmoil in the Middle East and Japan left investors questioning the wisdom of a rate hike in the face of doubtful global growth. However, there is still a strong expectation of a move by the ECB in April, which is why the euro saw such strength against sterling yesterday.
 
In the USA, the Federal Reserve met last night and maintained rates and quantitative easing on hold, but did state that they are unlikely to add further stimulus as the US recovery gathers pace. There was widespread panic yesterday in Japan as concerns over a nuclear crisis left investors heading for safe currencies. The US dollar strengthened against the euro and sterling.
 
Elsewhere, the higher yielding ‘commodity’ currencies of the Australian dollar, NZ dollar and South African rand had a terrible day after falling around 2% against most currencies. The rand in particular suffered – falling nearly 3% against the US dollar as Japan is a key trading partner to South Africa. If you have been holding off on buying rand, now is a far better time to look at it as it was about the only currency that sterling strengthened against.
 
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 March 15th, 2011 by Charles Purdy

Daily Currency Note

EURO/GBP - 1.1537
US$/GBP – 1.6060
CHF/GBP – 1.4813
CAN$/GBP – 1.5734
AUS$/GBP – 1.6134
ZAR/GBP – 11.0563
JPY/GBP
– 130.85
HKD/GBP – 12.5221
NZD/GBP – 2.1900
SEK/GBP – 10.3061
US$/EURO – 1.3920
 

Sterling regained ground after falling to a 4 month low yesterday of €1.1506/£1 against the euro. Sterling dropped over the weekend after an agreement amongst European leaders to increase the bailout package, but recovered marginally as investors locked in profits from the euro’s move and the UK’s credit rating was affirmed by rating agency Fitch. The agency announced that the UK’s ‘triple AAA’ rating is looking increasingly secure as the coalition’s austerity plan takes effect. It is a relatively quiet day for data, with unemployment and a speech by Mervyn King tomorrow. Sterling should recover against the euro, especially if the Bank of England hikes interest rates by 0.25%, as they are expected to.
 
In the euro zone, the move by policymakers over the weekend to boost the euro zone bailout fund saw euro strength. However, comments by Eurogroup chairman Jean-Claude Juncker pushed the euro over $1.40/€1 as he stated that there had been a significant increase in inflation. Expectations that the European Central Bank will raise interest rates as early as next month have supported the euro, and these comments were no different. Out today there is German economic sentiment, so call in now for a live exchange rate.
 
In the USA, the US dollar rebounded from a 4 month low against the Japanese yen after the Bank of Japan extended $183bn of liquidity to support its banks in the wake of Friday’s destructive tsunami and earthquake. This bold action helped ease money markets and as a result fears over funding and liquidity were kept at bay. US dollar volatility is at nearly 12%, and the Japanese yen is set to strengthen as the Japanese government sells off part of its US$1 trillion US government bond holdings in order to pay for rebuilding.

Elsewhere, Russian President Vladimir Putin said on Monday that there was little threat of a global nuclear disaster as Japanese nuclear technicians battled to avert a meltdown at an energy plant. Either way, the impact of the earthquake is far reaching and currency markets have been incredibly volatile today.

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 March 14th, 2011 by Charles Purdy

Daily Currency Note

EURO/GBP - 1.1516      
US$/GBP – 1.6035
CHF/GBP – 1.4918
CAN$/GBP – 1.5589
AUS$/GBP – 1.5906
ZAR/GBP – 11.037
JPY/GBP
– 131.62
HKD/GBP – 12.495
NZD/GBP – 2.1704
SEK/GBP – 10.189
US$/EURO – 1.3919
 

Sterling hit a 6 week low against the euro and a 3 week low against the US dollar on Friday as markets began to push back expectations over interest rate hikes in the UK. In addition, the catastrophic earthquake and tsunami in Japan saw investors cut their exposure to perceived high risk currencies which put pressure on the pound. Out this week, there is claimant count figures released on Wednesday and Bank of England governor Mervyn King makes a speech, which could further impact market expectations over interest rates. Call in now for a live exchange rate.
 
In the euro zone, the euro strengthened against the pound and US dollar on Friday as European leaders agreed a deal over higher retirement ages, labour market flexibility and debt and deficit limits for European countries. An agreement on Saturday night to strengthen the bailout fund is one step in the right direction, but there is still a need for peripheral countries to shore up their finances. This week sees German economic sentiment, so ensure you protect yourself by talking to one of the team sooner rather than later.
 
In the USA, the major event of the week is the US Federal Reserve’s interest rate meeting on Tuesday. With an economic recovery that is running far from its potential and surging oil prices, the Fed is not expected to change much. There is potential for a large sell off of US bonds that are currently yielding very little.
 
Elsewhere, the Japanese yen saw a surge in demand following the country’s earthquake as investors cut positions that had been funded by cheap Japanese yen. The move saw large demand for yen and also speculation over potential insurance pay outs, and the currency surged. Whilst a strong currency is traditionally positive, the Japanese economy relies on exports and this is not likely to encourage export.

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 March 14th, 2011 by Charles Purdy

Daily Currency Note

EURO/GBP - 1.1600      
US$/GBP – 1.6047
CHF/GBP – 1.4977
CAN$/GBP – 1.5618
AUS$/GBP – 1.6027
ZAR/GBP – 11.0880
JPY/GBP
– 132.74
HKD/GBP – 12.5066
NZD/GBP – 2.1827
SEK/GBP – 10.244
US$/EURO – 1.3834
 

Sterling slipped yesterday after the Bank of England kept interest rates on hold at 0.5%. With many not expecting an interest rate hike until May at the earliest, some believed there might be an outside chance of an interest rate hike at the meeting. Earlier in the day, the pound did experience some strength against the euro after Spain’s credit rating was downgraded. Whilst inflation is an issue and markets are expecting an interest rate hike soon, the Bank of England are notoriously conservative and are unlikely to change much soon. The UK recovery is a little shaky, but ultimately we are in a better long term position than Europe and the USA. We (like many) expect to see sterling recover later in the year as Europe’s debt issues come to the fore again and the UK starts to outpace the US recovery. Call in now for a live exchange rate.
 
In the euro zone, the euro slipped against the US dollar and sterling on news early yesterday morning that Spain’s credit rating had been downgraded from Aa2 to Aa1 with a negative outlook. Euro zone debt problems are starting to come to the fore again, and there is nothing like a credit downgrade to do just that. However, interest rate expectations are likely to keep the euro supported against the pound and US dollar.
 
In the USA, the US dollar benefited from increased risk aversion as fighting in Libya escalated with Colonel Gaddafi’s son stating the time had now come for full scale military action against the rebels. In addition, US jobs data came in far worse than expected with figures showing that 26,000 more people claimed for unemployment this week and the trade deficit widened. Call in now for a live exchange rate.
 
Elsewhere, a massive earthquake has hit Japan causing a large tsunami. The Japanese yen has come under pressure already this morning – falling against the US dollar and seeing volatility against other US dollar currency pairs. Call in now for a live price.
 
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 March 10th, 2011 by Charles Purdy

Daily Currency Note

EURO/GBP - 1.1672          
US$/GBP – 1.6129
CHF/GBP – 1.5033
CAN$/GBP – 1.5640
AUS$/GBP – 1.6071
ZAR/GBP – 11.1200
JPY/GBP
– 133.56
HKD/GBP – 12.567
NZD/GBP – 2.1949
SEK/GBP – 10.278
US$/EURO – 1.3818

Sterling crept up against the euro yesterday after the euro’s recent rally ran out of steam on concerns over fragility in the euro zone. The pound hit a high of €1.1671/£1 on the day and better than expected UK trade figures helped sterling push over $1.62/£1 against the US dollar. Data showed that the trade deficit for the previous month narrowed from £9.7bn to £7.1bn – nearly £1.5bn better than expected. This is good for the UK as it shows that more goods were exported than imported last month, meaning that more money is coming into the UK economy. The big release today is the Bank of England’s interest rate decision. With uncertainty over the impact of higher oil prices, the Bank is likely to keep rates on hold but call in to ensure you are prepared for a shock interest rate hike – it only needs a 2 member ‘swing’ to see this happen.
 
In the euro zone, the recent euro rally petered out yesterday as investors and analysts began to question the wisdom of an interest rate hike when the majority of the region is suffering from astronomic levels of debt. Whilst there is likely to be a rate rise in April which will keep the euro supported, in the medium term the euro is likely to suffer from fragility over the debt crisis – highlighted by a downgrade of Spain’s debt by Moody’s. The issue was essentially deferred until European finance ministers could decide on what to do, but nothing has happened on that front so the markets are likely to expect some kind of resolution.
 
In the USA, the US dollar slipped against sterling but is likely to remain within the range of $1.61-1.63 as traders buy on the low and sell on the high. Oil prices rose to over $116 per barrel as fighting intensified in Libya and reports emerged of several oil facilities coming under attack. Oil is the big issue – especially in the USA, and the outcome of the current crisis is likely to set the tone for the US economy for the next few months.

Elsewhere, overnight the Royal Bank of New Zealand unexpectedly slashed interest rates by 0.5% in order to pre-empt the economic fallout from the recent earthquake. Many were expecting an interest rate cut of 0.25%, with some even calling for rates to be kept on hold. This is a bold move by the bank, so call in now as the New Zealand dollar is likely to see some weakness.

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 March 9th, 2011 by Charles Purdy

Daily Currency Note

EURO/GBP - 1.1647          
US$/GBP – 1.6148
CHF/GBP – 1.5076
CAN$/GBP – 1.5669
AUS$/GBP – 1.6009
ZAR/GBP – 11.1117
JPY/GBP
– 133.78
HKD/GBP – 12.5816
NZD/GBP – 2.1835
SEK/GBP – 10.266
US$/EURO – 1.3863

Sterling fell against the US dollar as investors sold off positions, but sterling did recover some ground against the euro as sovereign debt worries saw investors selling the euro. UK data was also poor with a retail sales survey underperforming and a house price survey coming in below expectations. The Bank of England begins their monthly interest rate meeting today, and with the current ‘scores on the doors’ at 6 members in favour of doing nothing and 3 in favour of an interest rate hike, there needs to be a 2 member swing to see anything happen. Well within the bounds of possibility? We find out on Thursday so call in now to get the best price.
 
Despite expectations that the European Central Bank will look to raise interest rates as soon as next month, the euro suffered today as a result of widening bond spreads following the ratings downgrades in Spain and Greece over the last few days. Analysts expect the euro to remain strong in the short term on interest rate speculation, but fall off against sterling and US dollar as the debt crisis comes to the fore once again. Out today we have German industrial production figures, so call in now for a live exchange rate.
 
In the USA, the US dollar took back some of the ground lost against the euro as investors contemplated what higher interest rates would mean for the euro zone with many countries already laden with high levels of debt. In addition, the ramifications of higher oil prices are a concern for many investors who feel that the current spike could push costs higher globally and see the world sink to a double dip recession.

Elsewhere, New Zealand’s interest rate decision is due today with commentators sharply divided over what will happen. With uncertainty following the earthquake, many are calling for a 0.25% cut from the current 3% but there is likely to be no change. Call in now for a live price.

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 March 8th, 2011 by Charles Purdy

Daily Currency Note

EURO/GBP - 1.1603
US$/GBP – 1.6179
CHF/GBP – 1.5128
CAN$/GBP – 1.5740
AUS$/GBP – 1.5994
ZAR/GBP – 11.103
JPY/GBP
– 133.49
HKD/GBP – 12.602
NZD/GBP – 2.1855
SEK/GBP – 10.293
US$/EURO – 1.3941
 

Sterling fell to a 5 week low against the euro yesterday as expectations of an interest rate hike in the euro zone saw sterling drop below €1.16/£1. Sterling has itself been on a strong run of form since the beginning of 2011 as the Bank of England battles with stubbornly high inflation, but a poor set of figures for services sector activity left many cutting back expectations of a UK interest rate hike. Overnight we had retail sales and house price figures that painted a mixed picture, with retail sales slightly worse than expected. A house price survey showed fewer estate agents reporting a fall in prices, but the picture was still poor. Mervyn King speaks at the Asian Business Association Dinner in London, and ahead of Thursday’s Bank of England meeting this speech will be watched closely.
 
In the euro zone, the euro hit a 4 month high against the US dollar yesterday after expectations of an interest rate hike as early as next month saw the euro break over the $1.40/€1 barrier. Friday’s downgrade of Spanish debt and yesterday’s downgrade of Greek debt were overlooked as investors focussed on Jean-Claude Trichet’s shock announcement over European interest rates. Call in now for a live exchange rate as there is a lot of volatility in the market.
 
In the USA, the US dollar has now fallen by 9% against the euro on relative interest rate differentials – i.e. the market expects the European Central Bank to raise interest rates way ahead of the USA. However, data is showing that the US recovery is improving whilst the European debt crisis remains and could flare up at any moment. As a result, many analysts are predicting that the euro will return to levels in the $1.20’s against the US dollar as the fiscal bite takes hold in Europe later this year.

Elsewhere, the South African rand strengthened to a 7 week high against the US dollar yesterday as gold gained to $1,444.95 an ounce and violence in Libya boosted oil to a 29 month high. Against sterling, rand gained by 0.5% to finish the day at ZAR 11.124/ £1.

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 March 7th, 2011 by Charles Purdy

Daily Currency Note

 

EURO/GBP - 1.1639
US$/GBP – 1.6290
CHF/GBP – 1.5072
CAN$/GBP – 1.5825
AUS$/GBP – 1.6052
ZAR/GBP – 11.2030
JPY/GBP
– 133.65
HKD/GBP – 12.688
NZD/GBP – 2.2075
SEK/GBP – 10.328
US$/EURO – 1.3993

 

Sterling fell to a one month low on Friday against the euro as the single currency was boosted by comments from European Central Bank President Jean-Claude Trichet who said on Thursday that interest rates could rise as early as next month. Sterling held its ground against the US dollar above $1.62/£1 despite house price figures that showed that UK house prices fell at their fastest pace in over a year. Key data released this week includes retail sales and house prices overnight tonight, the UK trade balance on Wednesday and the Bank of England’s interest rate decision on Thursday. Interest rate speculation is yet again the name of the game this week so call in now to ensure you don’t lose out.

In the euro zone, the news this morning is that credit rating agency Moody’s has downgraded the credit rating of Greece even further – with a negative outlook for the future – citing uncertainty over the mammoth task facing the Greekl government. This has seen the euro fall off from close to $1.40/€1 against the US dollar that it hit towards the end of last week following talk of interest rate hikes. ECB President Trichet’s press conference today will be followed much more closely today as a result of his call for “strong vigilance” on inflation in the region. Call in now for a live exchange rate.


In the USA, despite positive non-farm payroll figures on Friday, markets were in reality a little disappointed after strong figures throughout the week. Either way, the Federal Reserve is being very loose with monetary policy and as a result the US dollar is unlikely to benefit from positive data in the same way as sterling has been of late. It is a relatively quiet week for data until the back end of the week, when there is unemployment data and retail sales.

Elsewhere, tensions in Libya have seen oil hit a 29 month high in the last few weeks and markets will be keeping a close eye on the situation there. The Swiss franc has been a major benefactor, but many feel it has been overbought and is set for a ‘correction’. 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 March 4th, 2011 by Charles Purdy

Daily Currency Note

EURO/GBP - 1.1639
US$/GBP – 1.6245
CHF/GBP – 1.5106
CAN$/GBP – 1.5822
AUS$/GBP – 1.6040
ZAR/GBP – 11.1940
JPY/GBP
– 133.87
HKD/GBP – 12.657
NZD/GBP – 2.2016
SEK/GBP – 10.258
US$/EURO – 1.3954
 

Sterling fell by nearly 1% against the euro yesterday as poor UK services sector activity sector contrasted sharply with a shock statement from the European Central Bank that the ECB could hike interest rates in the region as early as next month. Investors had up until now been pricing in a UK interest rate hike before Europe and the shock move by the ECB saw the euro break back into the €1.16’s against sterling. UK Services PMI, which measures the level of activity in the services sector, came in below expectations that left a sour taste in the mouth after an otherwise positive week for UK fundamental data. Out today, we have Halifax house prices which could cause some volatility so call in now for a live exchange rate.
 
In the euro zone, the euro gained by 0.7% against the US dollar as ECB President Jean-Claude Trichet said that “inflationary risks are to the upside” and that “strong vigilance” is required. The possibility of the ECB raising interest rates far sooner than expected has seen the single currency jump against the US dollar and sterling. Call in now for a live exchange rate.
 
In the USA, a proposal by Venezuelan President Hugo Chavez to broker a peace deal in Libya saw oil prices ease off and US stock markets on Wall Street posted gains. Unemployment figures were positive, with the number of claimants for unemployment insurance falling by 20,000 on last week. Tomorrow we have the key figure – non-farm payroll data. This employment data causes a lot of movement normally, so ensure you are protected.
 
Elsewhere, in a research note to clients, Lloyds TSB estimate that the price of oil (currently around $110) could hit $250 per barrel if the situation in the Middle East and North Africa continues which could potentially wipe £45bn off the UK’s GDP. We will have to see what happens…

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