Sterling holds steady supported by positive data
Monday was a quiet start to the week for sterling. Net Lending to Individuals, showed an increase in the amount that was loaned by banks to individuals. This gave sterling a boost as it showed that both banks and individuals are more confident in lending or borrowing money respectively, which, in turn, will help the public to boost its spending. Mark Carney also commented on this in his latest speech, advising that banks are standing stronger.
The Consumer Confidence Index is the first release expected today, predicted to show a stable figure. Current Account figures will also be released, which works as the UK’s Trade Balance; here we can expect a slight improvement resulting from more exports from the UK.
Sterling is still standing strong against the euro. Contact your trader today to find out the current rates and the latest news, particularly on how upcoming political and economic events, such as the UK Election, will affect the currency.
Euro weak due to continued Greek uncertainty
Just like sterling, the euro had a quiet start to the week. Talks between Greece and its creditors are on-going and are said to be upbeat, although lenders say it could take several more days before a list of measures and reforms are agreed. Germany released its inflation figures which showed that Germany had emerged from deflation after one month albeit only just.
Today we have the release of inflation figures for the Eurozone. Overall inflation is expected to show an improvement albeit still negative at -0.1% and core inflation steady at 0.7%. We also have the unemployment figures for the Eurozone released which are expected to be steady at 11.2%. Still very high, especially in the southern states. Hopefully it will start to come down as we see the benefits of the Eurozone quantitative easing programme begin to flow through.
The uncertain geo-political environment is still hampering the euro. Contact your trader to stay up to date with the latest developments and discuss currency buying strategies to manage this risk.
A quiet start as momentum builds for the US dollar
Another quiet start to the week. US Personal Income increased and Personal spending decreased, showing that the public are now looking to start saving with the anticipation of a possible rate rise later this year. The figure for pending home sales in the US also increased, the biggest increase since July 2014.
We are expecting a busier day today for the US Dollar, as three Federal Reserve Members speak – Fischer, Lacker and Lockhart. Their spotlight will be firmly centred on talks regarding Interest Rates. Consumer confidence is also expected to show a stable figure, meaning further good news for the US economy.
The currently strong US economy is affecting the strength of the country’s currency against its major pairings. Contact your trader for the latest rates, news and information on how this may affect you.
Canadian dollar can’t compete with the US
- The Canadian dollar dropped to one-week lows against its lively neighbour. This was largely due to a stronger day for the US, with further support being shown for the strength of the US economy as US personal spending and income data came out as positive figures. However, the Canadian dollar did show some signs of resistance, as Canadian raw material prices rose 6.1% in February, beating expectations for a 5.1% increase. It finished the day down almost half a percent against the US dollar.
- The Australian dollar also struggled against its US counterpart for similar reasons. Federal Reserve Chair Yellen’s speech on Friday showed optimism for growth in the US economy, causing weakness for the majority of the US’s major rivals.
If you are buying and selling international currencies, contact your trader today for the latest economic developments and how these are likely to affect your transactions.
The General Election is up and running, how will sterling react?
The last couple of weeks have been difficult for sterling losing ground against the board and this could continue as the General Election officially starts today as Parliament is dissolved. The weekend papers highlighted Labours lead in the opinion polls which would be good for our continued membership of the European Union. I am sure, as we saw with the Scottish vote on Independence, there are likely to be many twists and turns in the next few weeks, probably matched by sharp movements in sterling.
Yet another deadline for Greece
The Euro has been enjoying a renaissance over the last couple of weeks strengthening against the US dollar and sterling.
Today we have yet another meeting between the Greeks and their key lenders. Hopefully the list of reforms is close to being agreed as Greece is fast running out of money and desperately needs the next tranche of bailout funds.
Key data releases this week centre around inflation and employment. After February’s surprise reduction in deflation to -0.3%, expectations are for another improvement in March to -0.1%. Unemployment for the Eurozone is expected to hold at 11.2%.
Will poor US data undermine the US dollar?
The key question that everyone wants an answer to is when will the US start raising interest rates? Trouble is there seems no clear timetable as US economic data is wavering.
This week we have key employment data due out on Thursday and Friday and important manufacturing data out on Wednesday. Expectations are for these to have fallen, not disastrously but enough to make forecasting the timing of an increase even more difficult.
China – how is it doing?
China for many years has been at the forefront and a key driver of growth. Recent times have seen it falter and this week we have key March Purchasing Managers Index for Manufacturing. Last month markets were surprised as it fell below 50, the figure above which indicates expansion and below contraction in that business sector. The figure is expected to be below 50 but slightly improved against February’s reading