Sterling under pressure in the shadow of the EU vote
After falling to eight-month lows against the US dollar on Tuesday, sterling managed to steady the ship yesterday. Concerns about the UK’s role in the European Union and the outcome of the Referendum vote likely to be in 2016 are casting a shadow over the currency and the outlook for the British economy. Combined with the fading chances of the Bank of England following in the footsteps of the US Federal Reserve and raising interest rates, there has been a slump in sentiment for sterling.
We expect another relatively quiet day in the markets in the run up to the start of January, with attention turning to the US for the release of Unemployment Claims data, while a Bank Holiday in Germany could result in reduced trade volumes.
Sterling is under pressure in the current market and this could continue into 2016. Contact your trader in the first week of January to get the latest rates and to discuss currency strategies.
No real change for the euro
Wednesday was one of the quietest day of the year for the euro, as it remained near enough unchanged against it major trading peers. Spanish Consumer Price Index data came out slightly worse than forecast, at-0.1%, but this was an improvement on last month’s figure of -0.4%. However, this data was largely overlooked, overall.
New Year’s Eve is likely to be another stagnant day for the single currency, but with some key data to be released in early January, we can expect a brisk start to 2016.
If you are looking to buy or sell euros, it is important to keep an eye on the markets as the New Year begins. Contact your trader in the first week of January for the latest rates, news and to discuss currency strategies for the year ahead.
US all set to end the year on a positive note
The US dollar enjoyed small gains on the penultimate day of trading of 2015. Although December has been relatively uneventful for the US dollar, it is poised to round off an otherwise excellent year on a positive note, and given the European Central Bank’s (ECB) continued favouritism towards easier monetary policy, fortunes bode well for the dollar as we head into 2016. However, if oil prices continue to drop into the New Year, the US dollar could see a more troubling year ahead than the Federal Bank would have hoped for.
We anticipate further interest rate rises, changes in oil prices and market movement for the US in 2016. Contact your trader in the first week of January for the latest rates and to discuss appropriate currency strategies.
We saw the Australian and New Zealand dollars trading narrowly, as expected, yesterday, as there was no data released from either country. However, we did see the commodity linked currencies pick up some ground and strengthen against their major currency rivals, following the rise in oil prices over the last 24 hours.
The Private Sector Credit data for Australia will be released today, which could create some movement in the market.
Contact your trader today if you’re looking to buy or sell currencies, to see how these currency movements may affect you and to plan an appropriate strategy.
Sterling still under pressure, despite festive lull
Following Monday’s Boxing Day Bank Holiday in the UK, yesterday saw subdued trading across the currency markets, with a lack of significant economic data releases and low market participation. Despite this, sterling still found itself under pressure and extended its recent losses against the US dollar, falling to an eight-month low against its major counterpart, as US consumer confidence surged throughout December following the Federal Reserve’s interest rate hike.
Another quiet day lies ahead, with little to excite investors other than the release of preliminary Spanish Inflation figures in the morning, and US Home Sales data, which follows later in the afternoon.
Sterling has been having a difficult time throughout December. Contact your trader today to see how this affects you.
Mixed fortunes for the euro – but nothing to worry about yet…
After markets re-opened following the Bank Holiday on Tuesday, the euro had a mixed day against its major pairings of sterling and the US dollar. With the US dollar having a good day, thanks to positive Consumer Confidence and Trade Balance data released, the euro weakened, as is often the case in these circumstances, as they are the two most traded currencies on the planet. This is even more exaggerated when the markets are quiet and liquidity is low. The single currency marginally weakened against sterling, but this was nothing of note; the small increase was most likely as a result of investors opening new positions after Christmas.
We will see Inflation data released this morning from Spain, but are expecting little movement for the currency now until the New Year.
If you are looking to buy or sell euros, this quieter period is a good time to review your currency strategy and contact your trader for the latest rates.
Happy Holidays for the US dollar
The US dollar has held its ground well over the festive period, reaching a four-month high against the Chinese yuan – a significant result for the US economy. It seems that most major trading houses are holding off their larger bets until the New Year, so the US dollar continues to trade within familiar ranges. Higher than expected Consumer Confidence and Trade Balance figures released yesterday helped the dollar gain a cent against both sterling and the euro.
This latest development spells good news for the US dollar, and we anticipate further positive data from the US. If you are looking to buy or sell US dollars, contact your trader now for the latest rates and to discuss your currency strategy.
Australia and New Zealand strengthen against their rivals
It was a quiet week on the data front for global currencies, but we have seen the Australian and New Zealand Dollars gain strength against their rivals since the Christmas break, and both currencies are currently trading at their strongest level since June/July 2015. There was no data released from Australia and New Zealand during the last few trading sessions, and it is expected to be another steady session today, trading narrowly near support levels.
The Private Sector Credit data will be released from Australia on Thursday, which is expected to be a figure of 0.6%, compared to the previous result of 0.7%.
Are you looking to buy or sell currencies? Contact your trader today to see how these movements affect you and to plan an appropriate currency strategy.
Sterling strengthens slightly, but still struggles through the week
It was not a good week for sterling, as the currency dropped to a three month low against the euro and fell to its lowest level against the dollar since April 2015.
However, yesterday we may have seen the beginning of the end of sterling’s slump, with a number of key influential indicator data released. Sterling has managed to claw back some of the strength it lost this week, with the help of UK Current Account data figures that were better than expected at -17.460 billion, compared to a consensus of -21.500 billion and last month’s reading of -17.490 billion. Total Business Investment data remained constant at 2.2%, which also helped sterling to strengthen across the board, despite UK Gross Domestic Product (GDP) data falling 0.1% short compared to the expected 0.5%.
BBA Mortgage Approvals data will be released on the morning of Christmas Eve; the only piece of data due to be released from the UK. This is considered a leading indicator of the strength of the UK housing market and the consensus is expected at 46.200 thousand, compared to the previous result of 45.437 thousand, which means we could see sterling strengthen further, although we expect only small movement if this is the case.
Sterling is still struggling. Contact your trader today to see how this affects you and to plan your currency strategy.
The euro loses ground unexpectedly
This week has been a real surprise in term of movement for the euro, struggling to keep its recent hot run of form going. Most investors expected the run up to the festive season to be a quieter time for the euro, but it has turned out to be a busier week than normal. Earlier in the week we saw the euro reach its highest point against sterling since October 2015, while the single currency lost quite a lot of ground yesterday after what had been a positive week. There was no data released to fight back against the positivity from the US dollar, causing the euro to decline gradually. It also struggled against sterling, down to low liquidity in the market and the US dollar being in higher demand than the euro, the euro.
If you are looking to buy or sell euros, now is a good time to review your currency strategy and get in touch with your trader for the latest rates, particularly considering the currency’s recent surprise movement.