UK house price increases steady sterling | Smart Daily Currency Note
This week (Last week)
GBP/EUR – 1.1668 (GBP/EUR – 1.1661)
GBP/USD – 1.5216 (GBP/USD – 1.5092)
EUR/GBP – 0.8569 (EUR/GBP – 0.8573)
EUR/USD – 1.3032 (EUR/USD – 1.2940)
GBP/AED – 5.5848 (GBP/AED – 5.5431)
GBP/AUD – 1.5786 (GBP/AUD – 1.5595)
GBP/CAD – 1.5686 (GBP/CAD – 1.5581)
GBP/CHF – 1.4517 (GBP/CHF – 1.4598)
GBP/HKD – 11.8065 (GBP/HKD – 11.7171)
GBP/INR – 85.8674 (GBP/INR – 83.872 )
GBP/JPY – 153.50 (GBP/JPY – 153.58)
GBP/NZD – 1.8802 (GBP/NZD – 1.8638)
GBP/SEK – 9.9682 (GBP/SEK – 10.0148)
GBP/ZAR – 15.3820 (GBP/ZAR – 14.391)
Sterling rose against most of its major trading partners barring the euro yesterday; finding support in the wake of house prices increasing at the fastest annual rate since 2011 and most markedly against the US dollar as weak economic releases from the world’s largest economy have diluted speculation that the Federal Reserve will scale back its asset purchase programme. Bouncing back from disappointing retail sales figures on Wednesday, sterling made advances following a report from mortgage lenders nationwide showed house prices had risen 1.1% from last year. With the housing market slowly gaining momentum and the sporadic recovery in the UK continuing to head in the right direction, sterling has started to gather a little bit of momentum – the question however is whether or not sterling can maintain this strength. With lending data emerging today call in for live markets rates at Smart Currency.
The euro performed well yesterday, moving upwards across the board and notably against sterling, the Japanese yen and a weaker US dollar. Higher core bond yields and more positive debt news in periphery countries provided support for the seventeen nation currency to rally throughout Thursday though price levels in euro pairs remain very volatile. Higher borrowing costs have materialised in the wake of anticipation of the US Federal Reserve tapering back its quantitative easing strategy, though Italy sold off its maximum amount of debt it had hoped to offer. The euro has seen a mix of data released from Germany with higher than anticipated inflation data marred by much worse than expected unemployment change figures released alongside import data indicating that demand in Europe’s largest economy is slowing. Other data released this week included a French consumer confidence survey which detailed another drop in the wake of France’s government reforming labour laws introduced in an attempt to stop a concerning rise in unemployment. Retail sales released from Germany today will be watched closely as will French consumer spending data and euro-wide unemployment and inflation data. Be in touch today for expert feedback and live prices with your trader.
After a strong start to the week which saw the US dollar perform well with strong consumer confidence and house price figures, it fell in many of its most traded pairs through Wednesday and Thursday after the US Department of Labour reported that the number of people registering for unemployment benefit grew last week by 10,000 rather than dropping by 4,000 as forecast. The US Commerce Department meanwhile revised down first quarter GDP figures to 2.4%, down 0.1% from the preliminary reading as slower inventory building activity and cuts in government spending took their toll. With this, anticipation waned for the first time in some weeks that the Federal Reserve may continue its asset purchasing programme for the near future. However strong consumer spending figures, the highest gain since 2010, revealed that rising real estate valuations and a healthy equity market are still driving the recovery forward, with a forecast that is still positive for the world’s largest economy. Inflation and personal spending figures as well as revised consumer sentiment data are released today; call your trader for up-to-the-minute feedback and trading valuations.
Elsewhere the Canadian dollar strengthened after losing ground the last couple of days, hitting a weekly high against a broadly weak US dollar as current account data showed the deficit had decreased more than previously forecast on increasing commodity exports. The Australian dollar also improved, from the lowest level in over nineteen months following positive building approvals data which grew more than estimated; decreasing the likelihood that the Reserve Bank of Australia will cut interest rates. The South African rand however dropped by 2.6% against sterling and moved under the 10 per dollar mark for the first time since 2009 – continuing from losses incurred against most of its peers over the last week. Concern that the American Federal Reserve will cut back its asset purchase programme has negatively affected demand from investors in emerging market currencies; with the rand’s downward trajectory already in motion following weaker than expected growth data and comments from the President of South Africa who articulated that the recovery was running behind schedule. Overnight we saw the release of a Business Confidence report from New Zealand and crucially for the Canadian dollar later on today we will have domestic growth figures. Talk to your trader today for all global market reaction going into the weekend.
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Sterling struggles following poor UK retail sales figures | Smart Daily Currency Note
GBP/EUR – 1.1687
GBP/USD – 1.5142
EUR/GBP – 0.8555
EUR/USD – 1.2948
GBP/AED – 5.5581
GBP/AUD – 1.5662
GBP/CAD – 1.5682
GBP/CHF – 1.4536
GBP/CNY – 9.28
GBP/HKD – 11.7482
GBP/HUF – 338.80
GBP/INR – 84.96
GBP/JPY – 152.38
GBP/NZD – 1.8678
GBP/RUB – 47.84
GBP/SEK – 10.0672
GBP/ZAR – 14.8421
Sterling had mixed performance in currency market yesterday; weakening against European currencies and the Japanese yen but gained ground against the US dollar. The UK currency rose by around a cent against its stateside counterpart despite a release from the Confederation of British Industry detailing that retail sales had fallen at their fastest rate in 13 months in May. The UK economy continues to struggle with realised retail sales dropping markedly from -1 to -11 points against an expected gain of 4 points. Consumers seem to still be wary of using up expendable income and without public confidence and spending increasing the economy will find it difficult to recover. Call in today to monitor sterling’s progress and price levels as markets anticipate the Bank of England’s policy meeting next week.
Euro prices were characteristically volatile throughout yesterday, though the single currency saw strong gains against a weak US dollar – gaining around a cent. This was despite German unemployment figures emerging considerably worse than expected, though this was tempered by inflation figures exceeding expectations – good news for Europe’s economic powerhouse after consumer confidence and manufacturing data has been positive for the country over recent weeks. Today is a relatively quiet day for the seventeen-nation currency, with only an Italian 10 year bond auction having any real potential to make an impact directly on price levels. The day is likely to be dominated by events elsewhere as the Eurozone continues to stall in its quest for economic recovery. Call in now to stay up to date with market movements and for a live quote.
The US dollar relinquished much of the ground it had made in the wake of Tuesday’s strong Consumer Confidence news as it fell against most major counterparts throughout yesterday’s trading. The US currency has risen 4% against the Japanese yen this month, and yesterday investors felt prompted to cash in on their profits; selling dollar for yen as a safe haven from weakness in equity markets and pressuring dollar value into a downward trajectory against most major currencies. The discussion over how soon the Federal Reserve will taper back their asset purchase programme however will be the key driver for dollar prices this week. Unemployment Claims reports from the US will be important tomorrow with its potential influence over monetary policy, along with preliminary growth figures for the US economy and Pending Home Sales data. With today carrying significant weight for economic news emanating from the US, call immediately for your trader’s feedback on how the markets could react.
Elsewhere, the Japanese yen was a notably strong performer over yesterday’s trading; rising against all of its major currency partners alongside a statement from the Governor of the Bank of Japan declaring that a stable financial grounding is vital for the country as the central bank pumps an unprecedented amount of stimulus into the economy. The government appears to be ready to do whatever it takes to get back on the road to growth, and yesterday investors flocked to the currency as refuge from a dip in equity markets and the US dollar being sold off. Elsewhere, the South African rand crumbled to four-year lows on speculation of US stimulus measures being reduced in the near future. The country’s economy continues to suffer with worker protests and unrest at a local level causing a prolonged slump in the South African economy. Call in and speak to Smart today for the latest news and price levels in your currency pair.
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The US dollar continues to strengthen | Smart Daily Currency Note
GBP/EUR – 1.1696
GBP/USD – 1.5049
EUR/GBP – 0.8549
EUR/USD – 1.2858
GBP/AED – 5.5209
GBP/AUD – 1.5742
GBP/CAD – 1.5658
GBP/CHF – 1.4661
GBP/CNY – 9.21
GBP/HKD – 11.6684
GBP/HUF – 336.91
GBP/INR – 84.49
GBP/JPY – 153.62
GBP/NZD – 1.8652
GBP/RUB – 47.39
GBP/SEK – 10.0871
GBP/ZAR – 14.7426
Sterling held its own after the bank holiday apart from against a well-performing US dollar yesterday afternoon. Though the UK currency fell against its American counterpart following strong US consumer confidence data, sterling steadily extended it’s rebound from last week against most of it’s major peers as expectation increases that the Bank of England will gradually move away from it’s quantitative easing cycle. As reports throughout the week are forecast to describe a further extension of credit for the private sector as well as rising house prices, sterling could be supported approaching the Bank of England’s interest rate decision in just over a week. If more central bank officials move towards supporting a reduction in Britain’s asset-purchasing programme, the recently fragile currency has the potential to outperform in this quarter. With Confederation of British Industry sales data emerging today as well as word from one of the members of the Monetary Policy Committee, stay in touch to monitor progress throughout the week.
German import data held back the euro yesterday as figures indicated that demand in Europe’s largest economy is slowing, whilst a French consumer confidence survey detailed another drop in the wake of France’s government reforming labour laws earlier in the month in an attempt to stop a concerning rise in unemployment. Mixed policy signals also continue to emerge from Europe, with one central bank member yesterday speaking out that interest rates could be cut further if needed whilst others are concerned of the impact negative interest rates could have on periphery economies. Youth unemployment still remains a major issue, and the single currency may struggle to hold it’s ground before the European Central Bank decision on interest rates on June the 6th. As the ECB presses on into uncharted territory and governments within the union continue to rely heavily on monetary policy, call in to Smart today for price movements and market reactions.
The US dollar rose to session highs against both the euro and Japanese yen whilst strengthening against all it’s major trading partners including sterling as the latest consumer confidence survey and house price release yesterday afternoon exceeded expectations – rising to a five year high for May as sentiment was boosted by a better business outlook and job opportunities. The consumer confidence index climbed to 76.2; the highest since early 2008, whilst house prices are at their highest level in seven years giving consumers more confidence to spend. The news has added fuel to speculation the Federal Reserve may taper back it’s quantitative easing programme in the near future as the world’s largest economy posts more positive data reports. With more movement expected on Thursday as GDP data will be released alongside US jobless claims figures (and unemployment being mentioned as a key factor in Federal Reserve monetary policy decisions), stay on top of developments by talking to your trader now.
Elsewhere, the South African rand fell to fresh four-year low against the US dollar; as economic growth data from Africa’s largest economy manifested itself in significantly worse shape than expected yesterday, and puts increased pressure on the central bank to loosen monetary policy toward a more assertive quantitative easing programme. Another currency weakening across the board was the Japanese yen as global equity markets rallied using cheaper borrowing from the country. A Bank of Japan member released a statement yesterday that it would be essential to keep both long and short term interest rates stable amidst perhaps one of the most intense monetary easing programmes in any economy currently. With more aggressive easing on the horizon markets are positioned for further yen weakness going forward, especially against it’s US counterpart. Tomorrow sees Mark Carney address a Canadian dollar that struggled yesterday with his final decision on interest rates. Don’t hesitate to call us for market reactions and feedback from your trader regarding your currency pair.
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Will sterling continue its downward trend? | Smart Daily Currency Note
GBP/EUR – 1.1692
GBP/USD – 1.5097
EUR/GBP – 0.8552
EUR/USD – 1.2902
GBP/AED – 5.5403
GBP/AUD – 1.5648
GBP/CAD – 1.5630
GBP/CHF – 1.4632
GBP/CNY – 9.23
GBP/HKD – 11.7104
GBP/HUF – 337.67
GBP/INR – 83.98
GBP/JPY – 153.98
GBP/NZD – 1.8644
GBP/RUB – 47.34
GBP/SEK – 10.0482
GBP/ZAR – 14.6072
Sterling had a more positive day on Friday, recovering a little of the ground lost earlier in the week and indeed some analysts are starting to suggest the Bank of England may be looking to slowly move away from their easing cycle, which could help sterling retrace it’s decline from earlier this year. Fresh evidence emerged on Friday that the UK housing market recovery is underway with mortgage approvals rising by 2.4% through April, though this remains below the levels seen before 2008. The report said that the government’s Funding for Lending scheme continues to support the market – particularly for first time buyers. This coming week will be relatively quiet for significant UK economic releases; with only data showing the net lending to individual and realised sales figures expected to be released alongside comments from several members of the Bank of England. Perhaps no news will be good news and sterling can bounce back from recent lows as speculation increases as to tighter monetary policy. Contact your trader to find out whether sterling can find momentum.
The euro found strength before the bank holiday after an industry report revealed that German business confidence increased beyond expectations though May – increasing optimism for the region’s recovery prospects after German and French manufacturing data emerged more positive than expected last week. News from Germany will be dictating the currencies performance once again this week with preliminary inflation figures and unemployment change data due on Wednesday. Spanish and Italian benchmark ten-year bond auctions will be a gauge of investor confidence in weaker economic zones whilst German and French retail sales and consumer spending reports are published on Friday. Other notables releases this week includes Eurozone wide inflation data as well as figures showing the overall level of unemployment across the Eurozone – currently expected to have increased to 12.2%. Stay on top of how the euro is performing by calling your trader now.
The US dollar found further strength before the bank holiday following news that durable goods orders increased more than forecast as the world’s largest economy continues on the road to recovery. The US dollar could well continue it’s strong performance into this week and beyond as speculation increases about the potential for the Federal Reserve to taper off their quantitative easing programme. Historically, an improving labour market was the catalyst for the central bank ending programme of monetary easing and with positive jobless claims data having emerged last Wednesday many believe the Federal Reserve will start to think about slowing the pace of asset purchasing in the near future. On the data front this week, Tuesday sees the release of monthly consumer confidence data which will give an insight into how the US retail sector is recovering. We are likely to see a degree of volatility on Thursday in response to a host of data being released including the change in the number of people claiming unemployment related benefits, pending home sales figures and preliminary quarterly GDP data which is currently expected to show that the worlds largest economy grew by 2.5%. Call in now for a live rate with Smart and to keep up to date as the week progresses.
Elsewhere, the Canadian dollar struggled before the weekend – notably against it’s US counterpart after speculation increased that the Federal Reserve could taper back monetary stimulus this year. Canada’s biggest export crude oil declined in price and as commodity values continue to fall the Canadian currency is expected to underperform. Wednesday’s Bank of Canada interest rate decision will be crucial to the Canadian dollars strength this week, at present no change is anticipated; however, the statement that follows should give clues for monetary policy decisions going forwards and could well set the tone for Canadian dollar prices going into the summer. Alongside the monetary policy decision, we also have a raft of data released from Canada including inflation data, current account figures and GDP data which is currently expected to show the economy only grew by 0.1%. The decline in commodity prices has also hit the Australian dollar, which along with recent evidence of the Chinese economy slowing has fallen throughout May. This Thursday, Australian Building Approvals figures will be significant as well as Private Capital Expenditure data which should provide early signals of future hiring, spending and earning activity. Other data released this week includes business confidence figures from New Zealand, manufacturing data from China and a raft of data from Japan including a speech from the Governor of the Bank of Japan which will be watched extremely closely given the recent movements in the Japanese yen. Call in now for a live price and for a market update.
Sterling has a tough week | Smart Daily Currency Note
This week (Last week)
GBP/EUR – 1.1661 (GBP/EUR – 1.1847)
GBP/USD – 1.5092 (GBP/USD – 1.5242)
EUR/GBP – 0.8573 (EUR/GBP – 0.8435)
EUR/USD – 1.2940 (EUR/USD – 1.2863)
GBP/AED – 5.5431 (GBP/AED – 5.5976)
GBP/AUD – 1.5595 (GBP/AUD – 1.5640)
GBP/CAD – 1.5581 (GBP/CAD – 1.5590)
GBP/CHF – 1.4598 (GBP/CHF – 1.4733)
GBP/HKD – 11.7171 (GBP/HKD – 11.8320)
GBP/INR – 83.872 (GBP/INR – 83.643)
GBP/JPY – 153.58 (GBP/JPY – 156.26)
GBP/NZD – 1.8638 (GBP/NZD – 1.8788)
GBP/SEK – 10.0148 (GBP/SEK – 10.1740)
GBP/ZAR – 14.391 (GBP/ZAR – 14.3070)
Sterling has had a tough week, having dropped sharply against both the euro and US dollar since Monday, falling by nearly two cents at their lowest point. Yesterday however further slides were averted; bouncing back from the lower than anticipated inflation data and disappointing retail sales figures released on Monday and Tuesday respectively as the updated release of the GDP figures for the first quarter confirmed the economy had expanded at 0.3%. Home asking prices rose for a fifth consecutive month this week which also helped sterling. Monetary Policy Committee meeting minutes revealed Mervyn King had been outvoted again on the issue of increasing quantitative easing, though in light of lower inflation contributing to sterling weakness many expect incoming Governor Mark Carney to have more leeway to expand the asset purchase programme. Be in touch with your trader today for the latest information going into the bank holiday.
With bank holidays in Germany, France, and the Netherlands at the start of the week it has been a relatively quiet period for economic news emanating from Europe. The single currency held fairly steady against its major trading partners though as the region still struggles with economic and political instability weakness especially against the safe haven currencies is still expected in the longer term. The European Union Economic Summit in Brussels had mixed impacts on the markets, with monetary policy being highest on the agenda and ministers have been putting continuing pressure on the central bank to further support stimulus programmes. French and German monthly manufacturing and services data yesterday, although still showing overall contraction, came in slightly better than the previous month bolstering the euro towards the end of the week. Today sees the release of German Business Climate figures with the health of Europe’s economic heart pivotal in dictating currency strength across the seventeen nations. Call your trader now for developments going into the weekend.
The US dollar has remained broadly strong this week against all it’s major trading partners. The Federal Reserve Chairman spoke out midweek and encouraged speculation that the central bank would be prepared to taper back it’s asset purchase programme going forward if it can be confident the economic recovery can be fully sustained. His focus however was on the difficulties posed by government spending cuts and especially unemployment, whereby tightening monetary policy too early would jeopardise the recovery. Minutes from the Federal Reserve’s latest meeting corroborated that sentiment, though jobless claims data released yesterday came out more positively than expected which is likely to fuel expectation that quantitative easing activity could be scaled down in the near future. Today sees the release of figures on durable goods orders. Analysts expect strong performance in data releases over the coming weeks to maintain dollar momentum. Call in today for reactions, news and price levels with Smart.
Elsewhere, the beginning of the week looked better for the antipodean currencies with the Australian Dollar rising for the first time in 3 days against the US Dollar, whilst the New Zealand dollar rose against all of its major currency partners on the back of good home purchase data. The New Zealand finance minister the suggested that the central bank may look at raising interest rates which caused the New Zealand dollar to gain against the majority of its peers. The Japanese yen had a turbulent week following comments from Japan’s Economic Minister who said that further losses to the currency’s value would start to have negative effects on the Japanese economy whilst stating that the currency had fallen far enough. The yen carried on weakening however after the Bank of Japan affirmed a plan to double it’s monetary base over a two year period. Yesterday however, the Japanese yen snapped this trend and surged against all of its major trading partners whilst the Japanese stock market tumbled over 7% over 24 hours as investors started to panic about the state of the global economy. The Canadian Dollar had little joy following disappointing retail sales data for the month of March raising speculation that the central bank will move to reconsider its plan to raise interest rates. In other news the South African Rand tumbled heavily on news that interest rates would remain at 5% for the foreseeable future. Call your trader today for news and price levels in your currency pair.
Sterling stumbles and starts to fall | Smart Daily Currency Note
GBP/EUR – 1.1698
GBP/USD – 1.5036
EUR/GBP – 0.8547
EUR/USD – 1.2832
GBP/AED – 5.5132
GBP/AUD – 1.5618
GBP/CAD – 1.5609
GBP/CHF – 1.4673
GBP/CNY – 9.21
GBP/HKD – 11.6533
GBP/HUF – 340.60
GBP/INR – 83.84
GBP/JPY – 153.03
GBP/NZD – 1.8732
GBP/RUB – 47.33
GBP/SEK – 10.0138
GBP/ZAR – 14.4714
Sterling tumbled on Wednesday in most of its major pairings – reaching seven week lows against the US dollar – stemming from poor retail sales data released yesterday morning and following the lower inflation levels from Tuesday. The UK currency struggled across the board despite making up some ground against the euro late on after retail sales dropped 1.3% due to a wet and cold winter; confounding expectations for a flat reading. Although the Monetary Policy Committee meeting minutes revealed that the Bank of England Governor Mervyn King was outvoted 3-6 again against expanding quantitative easing, speculation that incoming Governor Mark Carney will expand the asset purchase programme over coming months in light of lower inflation has contributed to sterling’s weakness. This could be the start of another period of market negativity towards the UK currency, though Business Investment data and importantly GDP figures released today will be helpful if growth stays in line with expectations. Call in today for the latest market reaction to UK developments from this morning onwards.
The euro had a mixed day yesterday, with characteristically volatile price movement despite little data being released. Reaction to disappointing retail figures in Britain drove euro to a four-week high against sterling, though the seventeen-nation currency fell by over a cent against the US dollar in the afternoon following news from the Federal Reserve. European Union ministers continue to promote that unemployment and sluggish growth will be combated as a matter of urgency so the central bank will be under pressure to further support monetary union in touch economic and political times for the region. This morning sees the release of manufacturing and services PMI figures from the French and German core of the Eurozone where economists forecast a slight improvement on the previous month’s data, though this is unlikely to be enough to inspire confidence regarding wider economic health from the heart of the Eurozone. Get in touch for the latest rates and on-going news today.
The US dollar accentuated it’s strength against most major counterparts yesterday. Federal Reserve Chairman Ben Bernanke spoke out Wednesday afternoon about tapering back it’s quantitative easing programme over the coming months if the central bank can be confident of sustained economic recovery. Nonetheless, he stressed that the US economy is still weighed down by cuts in government spending and high unemployment, whereby a premature tightening of monetary policy would put the recovery at risk and force inflation downwards. Unemployment was highlighted as a costly issue as the country continues to deploy an aggressive bond-buying programme to boost growth. Along with New Home Sales figures, Unemployment claims data from the US will emerge this afternoon, which will likely have some sway over dollar value with Bernanke highlighting the job market as being key to monetary policy going forward. Call your trader now for up to the minute prices with Smart.
Elsewhere, the Canadian dollar’s poor start to the week continued into yesterday, falling against the majority of its main trading partners, and to a two-month low against its US counterpart as crude oil prices maintained a downward trend. Canadian retail sales were also shown to have stagnated in March, raising expectation the central bank will reconsider its plan to raise interest rates. The Japanese yen also lost ground against the US dollar as well as the euro after the Bank of Japan affirmed a plan to double it’s monetary base over a two year period. Their monetary policy meeting ended with little change in policy, though uncertainty will still surround the yen as to whether it’s value has dropped far enough. The Bank of Japan Governor speaks this evening and his comments should shed some light on his attitude towards what has over recent months been a particularly assertive monetary policy going forward. Call your trader today for news and price levels in your currency pair.
Sterling suffers as inflation falls | Smart Daily Currency Note
GBP/EUR – 1.1718
GBP/USD – 1.5136
EUR/GBP – 0.8533
EUR/USD – 1.2908
GBP/AED – 5.5563
GBP/AUD – 1.5482
GBP/CAD – 1.5558
GBP/CHF – 1.4690
GBP/CNY – 9.27
GBP/HKD – 11.7394
GBP/HUF – 339.34
GBP/INR – 83.96
GBP/JPY – 155.43
GBP/NZD – 1.8586
GBP/RUB – 47.26
GBP/SEK – 10.0195
GBP/ZAR – 14.4612
Sterling dropped on almost all fronts yesterday, falling to a seven-week low against the US dollar as markets reacted to inflation rates coming in lower than expected at 2.4% for April, down from 2.8% in March: the first fall since 2012. The figures showed that lower fuel prices outweighed a rise in grocery costs as the cold and wet winter hit crop production. The data gives the Bank of England and incoming Governor Mark Carney more leeway to stimulate economic growth by expanding the UK’s asset purchasing programme and so caused a significant reaction in the market. The government has signalled it would be more relaxed about the bank loosening it’s hold on inflation in favour of acting to stimulate the economy, though Tuesday’s news has reinforced investor’s decisions to sell sterling before tomorrow’s crucial release of minutes from the latest Monetary Policy Committee meeting. The report will reveal how many policy makers voted to expand asset purchases to boost growth as it aims to encourage a stronger recovery, though a change in support to that effect is likely to instil further sterling weakness. Be in touch with your trader throughout today for rates and feedback.
It was mixed day for the euro yesterday as it experienced further volatility amidst the on-going uncertainty regarding central bank policy in the UK, the US and in Europe. The single currency performed well against a struggling sterling throughout the day, but expectations are low for today’s EU economic summit as many fear that despite increasing pressure to take action to reverse widespread economic contraction many expect the group to attempt to buy more time as they become increasingly reliant on monetary stimulus. More influential data is expected later on in the week in the form of French and German manufacturing and services figures which follow last week’s disappointing growth report, whilst on Thursday the European Central Bank President delivers his speech which should give clues to monetary policy going forwards. With further volatility in euro markets likely this week, call in now for live rates and response on developments from Smart.
Tuesday’s trading saw the US dollar resume it’s advance against most of it’s major counterparts as markets await the Federal Open Market Committee’s latest meeting minutes this evening. Having lost ground on Monday the currency made gains in most pairings, though markets have been cautious before today’s pending events. The Federal Reserve will be thrown into focus if the meeting minutes show a growing willingness to alter it’s current stance on quantitative easing involving a monthly 85 billion dollars in asset purchases. Speculation from last week has been circulating that the Federal Reserve could start to wind down it’s easing programme as early as this summer and any movements towards this are likely to boost dollar prices going forward. We will have a better idea by the end of today when the FOMC minutes emerge and the Federal Reserve chairman testifies in congress. Call your trader now for market reactions coming up to this evening.
Elsewhere, the Canadian dollar fell against the majority of its main trading partners, dropping to a two-month low against the US dollar, as data showed crude oil, Canada’s biggest export, broke the four-day rally it had achieved in spite of commodity prices falling almost ecumenically. Tuesday was also a poor day for the Swiss franc with it losing ground to the euro amid rumours that the Swiss National Bank could implement negative interest rates on banks’ excess deposits. The Australian dollar carried it’s momentum from Monday; rebounding from its worst period against the US dollar in more than a year whilst New Zealand dollars also saw strength building on their biggest advance in eight months. Overnight we saw the Bank of Japan deliver it’s statement on monetary policy and later on today the Swiss National Bank Chairman speaks along with the release of monthly Canadian retail sales data. Be in touch today for up to the minute rates on your currency trades.
House prices support sterling | Smart Daily Currency Note
GBP/EUR – 1.1822
GBP/USD – 1.5231
EUR/GBP – 0.8458
EUR/USD – 1.2878
GBP/AED – 5.5910
GBP/AUD – 1.5520
GBP/CAD – 1.5632
GBP/CHF – 1.4744
GBP/CNY – 9.32
GBP/HKD – 11.8146
GBP/HUF – 343.31
GBP/INR – 83.78
GBP/JPY – 156.32
GBP/NZD – 1.8603
GBP/RUB – 47.47
GBP/SEK – 10.1214
GBP/ZAR – 14.3982
Sterling gained ground yesterday morning against most of it’s major peers including the euro and US dollar after an industry report showed home asking prices to have risen for a fifth consecutive month. The data from Smart Currency partners Rightmove Plc described house prices rising by 2.1%, pushing values to record highs and bringing sterling up from it’s lowest level in six weeks against the US currency. A slew of economic data is scheduled for release this week that should prove influential for the UK and sterling’s performance including the publication of key inflation data released today in the form of producer and consumer price indices. Later on this week, traders will pay close attention to the Bank of England latest policy meeting minutes, retail sales figures and revised growth data. Talk to your trader for the latest prices as things unfold.
It was a quiet start to the week for the euro, holding steady against the majority of its trading partners in the absence of much data being released due to the bank holidays being enjoyed in Germany, France and Holland. The euro remains weak as periphery countries are struggling to return to growth, and officials are struggling to meet on common ground with policy as recessionary stress continues. Prices are likely to be volatile as the European Central Bank comes under pressure to expand on it’s easing cycle. German Producer Price Index inflation data is released this morning, though most will be looking to French and German manufacturing and services data emerging on Thursday to give an indication of economic health and may well have more of an impact on euro rates. Speak to your dedicated trader for feedback and up to the minute market prices.
The US dollar lost ground almost across the board yesterday in what is being seen as a natural unwinding from the gains seen over the past two weeks. US dollar weakness against a firmer Japanese yen has weighed on demand for the US currency in anticipation of the Federal Open Market Committee (FOMC) meeting minutes released on Wednesday evening. A growing number of central bank officials are talking down speculation of additional monetary stimulus due to strong domestic confidence and a relatively healthily performing economy, which is why Wednesday evenings release is so pivotal to US dollar strength going forwards. A member of the FOMC is speaking this afternoon following comments from the Treasury Secretary, though the market will be poised for the President of the FOMC’s speech to Congress tomorrow in conjunction with Home Sales data and minutes from the central bank’s latest meeting. Call in for the latest rates and feedback from your trader.
Elsewhere, the Japanese yen performed well yesterday; strengthening by the largest margin in three weeks against the US dollar following comments from Japan’s Economic Minister who said that further losses to the currency’s value would start to have negative effects on the Japanese economy whilst stating that the currency had fallen far enough. The Australian dollar meanwhile rose against the US dollar for the first time in three days, whilst the New Zealand dollar enjoyed gains against all it’s major trading peers after the country’s finance minister said that with house prices on the rise, the central bank may be forced to raise interest rates. Get in touch for the latest rates.
US dollar strengthens, UK awaits BoE minutes | Smart Daily Currency Note
GBP/EUR – 1.1821
GBP/USD – 1.5195
EUR/GBP – 0.8458
EUR/USD – 1.2845
GBP/AED – 5.5733
GBP/AUD – 1.5564
GBP/CAD – 1.5622
GBP/CHF – 1.4732
GBP/CNY – 9.31
GBP/HKD – 11.7791
GBP/HUF – 344.19
GBP/INR – 83.54
GBP/JPY – 155.89
GBP/NZD – 1.8728
GBP/RUB – 47.58
GBP/SEK – 10.1678
GBP/ZAR – 14.2952
Sterling struggled to hold it’s ground before the weekend, most notably against a strong US dollar, though with the Bank of England looking less likely to increase the level of quantitative easing for now, this decline could be short lived. Indeed one of the members of the Bank of England committee spoke on Friday about the risks inherent in increasing the asset purchase facility beyond its current target level without risking higher inflation. UK Consumer Price Index inflation data is released on Tuesday, the Bank of England meeting minutes are released the following morning and significant growth and retail sales figures on Thursday. Sterling remains vulnerable to poor data emanating from the economy but could find strength if growth and inflation remains in line with expectations set over the last week. Be in touch over the coming days with your trader for reactions and live prices.
The euro had a volatile day against sterling and weakened significantly against a particularly strong US dollar as indications the European Central Bank will continue to activate it’s easing programme over coming months continued. Meanwhile, a Governing Council member warned some regions in the eurozone may face a ‘decade of adjustment’ as the area struggles to get back on the path to growth. Looking ahead to this week, it will be a quiet day for data in Europe today as much of Europe enjoys a bank holiday in observance of Whit Monday. The EU economic summit on Wednesday may have an effect on euro strength as traders continue to look for hints regarding future ECB interest rates and on-going monetary policy plans. Monthly manufacturing data from France and Germany released on Thursday are scheduled to describe continued industry contraction, whilst German business climate data released on Friday may prove influential. Call in now for a live rate and further euro information over the course of the week.
The US dollar continued to strengthen throughout Friday as much better than expected consumer sentiment figures were released alongside continued speculation regarding the Federal Reserve moving closer to ending it’s asset purchasing programme. The US economy continues to show some signs of a sustained recovery and ahead of this week’s release of minutes from the Federal Open Market Committee’s last meeting, the central bank may be prompted to taper off it’s quantitative easing activity. A winding down of the central bank’s monthly asset purchasing activity could happen as soon as this summer according to the President of the Federal Bank of San Francisco. Wednesday will be significant as Federal Reserve Chairman testifies before the Federal Open Market Committee’s and the latest meeting minutes are released, whilst unemployment claims data and home sales figures follow on Thursday. Be in touch throughout the week for whether the US dollar can maintain it’s upward momentum.
Elsewhere, the end of the week saw the Australian dollar continue to fall, showing no signs of recovery into Friday evening. The Canadian dollar also struggled after worse than expected inflation data was released. This week there are a few pieces of data to keep an eye on including annual budget data will come out of Australia and New Zealand and we will also see Canadian monthly manufacturing and inflation data. Furthermore, there is a raft of data out of Japan including the central banks monetary policy decision alongside statements from the Governor of the Bank of Japan. Get in touch for the latest rates.
Mixed week for sterling | Smart Daily Currency Note
This week (Last week)
GBP/EUR – 1.1847 (GBP/EUR – 1.1832)
GBP/USD – 1.5242 (GBP/USD – 1.5432)
EUR/GBP – 0.8435 (EUR/GBP – 0.8449)
EUR/USD – 1.2863 (EUR/USD – 1.3035)
GBP/AED – 5.5976 (GBP/AED – 5.6652)
GBP/AUD – 1.5640 (GBP/AUD – 1.5330)
GBP/CAD – 1.5590 (GBP/CAD – 1.5564)
GBP/CHF – 1.4733 (GBP/CHF – 1.4651)
GBP/HKD – 11.8320 (GBP/HKD – 11.98)
GBP/INR – 83.643 (GBP/INR – 84.1675)
GBP/JPY – 156.26 (GBP/JPY – 155.99)
GBP/NZD – 1.8788 (GBP/NZD – 1.8470)
GBP/SEK – 10.1740 (GBP/SEK – 10.1141)
GBP/ZAR – 14.3070 (GBP/ZAR – 13.9605)
Sterling started the week slowly with performance negatively affected by a buoyant US dollar and a UK trade report showing the country’s current account position to have continued to deteriorate. By midweek however, the UK currency climbed for the first time in four days as the Governor of the Bank of England’s last inflation report providing an upgraded forecast for the UK economy; indicating that growth could accelerate to 0.5% this quarter. More positivity came as unemployment claims were shown to have fallen, whilst yesterday more forecasts emerged suggesting that the economy will continue to grow at a faster rate coming into the summer than in the first quarter. With reasonable performance against the US dollar and euro going into the weekend, be in touch with your trader to see if sterling can maintain it’s upward momentum despite David Cameron struggling with support from his backbenchers in parliament.
The euro has struggled to hold its own this week, falling consistently against its major peers as its economy was shown to still be in recession, with production falling for the sixth consecutive quarter. While Germany grew by the smallest of margins at a disappointingly slow rate, France declared that it had fallen back into recession with output falling by 0.2%. Yesterday, the EU’s statistics office revealed that the region’s annual inflation rate declined to 1.2% in April; the lowest rate since early 2010 – leaving open the question of whether Central Bank President Mario Draghi will ease policy again after officials cut their benchmark interest rate to record lows. With little data released today from the Eurozone, call your trader today to get an update on euro price levels going into the weekend.
The US dollar fell from close to four-year highs against the Japanese yen and weakened against most of it’s major counterparts yesterday following disappointing unemployment claims data, a contraction in New York state’s manufacturing sector as well as weaker than forecast reports on housing and inflation. This tapered off what has been a particularly strong week for the currency which rose in the wake of good retail sales figures on Monday and expectations the Federal Reserve might scale back their asset purchasing activity, though this now may have proved to be presumptuous as dollar prices weakened following yesterday’s developments, leading many to the conclusion that the Federal Reserve will continue with it’s bond purchasing monetary easing programme for the time being. Watch out for consumer sentiment figures emerging today, though next Wednesday’s slew of reports will be most significant with results from the Federal Open Market Committee’s meeting. Be in touch for prices and reactions as they happen.
Elsewhere, the Australian dollar had an extremely poor week, struggling on the back of the annual budget release and weak data coming from China resulting in the Australian dollar hitting fresh eleven-month lows against the US dollar – fuelling rumours the Reserve Bank of Australia would continue to cut interest rates to further support the economy. The Japanese yen continued to struggle this week; falling to five year lows beyond the 102.00 level against the US dollar as the G7 meetings confirmed expectation of further consolidation for the Japanese yen following the government’s ground-breaking monetary policy programme. Some of these losses were then reversed following better than expected growth figures from Japan being released. The end of the week’s focus will be on the Canadian Dollar which has variable week based on weak internal data and figures released from the US. Friday sees core inflation data released along with retail figures coming from Canada: be in touch going into the weekend to keep up to date with world developments and currency price levels in your pairings.