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Posted July 26th, 2013 by Charles Purdy

Mixed fortunes for sterling | Smart Daily Currency Note

Last week            This week
(GBP/EUR – 1.1591)   GBP/EUR – 1.1583
(GBP/USD – 1.5229)   GBP/USD – 1.5376
(EUR/GBP – 0.8626)   EUR/GBP – 0.863
(EUR/USD – 1.3137)   EUR/USD – 1.3273
(GBP/AED – 5.5934)   GBP/AED – 5.6475
(GBP/AUD – 1.6601)   GBP/AUD – 1.6612
(GBP/CAD – 1.5786)   GBP/CAD – 1.5809
(GBP/CHF – 1.4346)   GBP/CHF – 1.4297
(GBP/HKD – 11.811)   GBP/HKD – 11.9272
(GBP/INR – 91.027)   GBP/INR – 90.611
(GBP/JPY – 152.24)   GBP/JPY – 152.02
(GBP/NZD – 1.9230)   GBP/NZD – 1.9056
(GBP/SEK – 9.9832)   GBP/SEK – 9.9463
(GBP/ZAR – 15.046)   GBP/ZAR – 14.96

Sterling

After maintaining an upward trajectory for most of last week, sterling experienced more mixed fortunes this week. The pound performed well from Monday as Prime Minister David Cameron announced that improving economic conditions may allow the Coalition Government to implement tax cuts in the near future. Varying levels of trader optimism were seen in the run up to the release of UK GDP figures, which came out yesterday and revealed that the UK economy grew by 0.6% in the second quarter. These figures largely conformed to key predictions, however the possibility still remains that the Monetary Policy Committee may vote in favour of further quantitative easing when they meet again in August and the figures did little to play down that possibility, causing sterling to drop sharply against the majority of its major peers. Additionally, revisions of previous GDP figures revealed that recession in the UK was in fact worse than first thought, which further contributed to sterling weakness. Overall, sterling has certainly plateaued to a degree after performing well last week and we will need to see further strong economic data coming from the UK to maintain hopes of a sustainable recovery, persuade investors that the Monetary Policy Committee will not loosen monetary policy in August. If they do it would weaken the pound. There is little data of note being released today, but further movement may be seen as traders take stock of the GDP data and react to on-going speculation regarding future increases in quantitative easing. Call your trader now to track sterling performance.

Euro

A reasonable strong week for the euro was topped off yesterday when a survey showed better-than-expected business confidence coming out of Germany. Earlier in the week we had strong manufacturing and consumer confidence data coming out of the 17-member state. All these factors are suggestions that the Eurozone may be on course for a slight recovery in the second half of the year, and confidence in the market is quietly building. These are still early days, however, and there is every possibility that the region’s six-quarter recession will continue and drag into a seventh. Today is fairly quiet data-wise in the Eurozone, with the only event of note is the import price statistics coming out of Germany. Get in touch for live euro rates.

US Dollar

As expected, the US dollar sensitivity to economic data has been magnified recently following comments from the Chairman of the Federal Bank expressed his commitment to an accommodative monetary policy and this has caused it to be another tough week for the dollar. Early weakness was experienced in response to worse than expected existing home sales data, causing the dollar to slide against the majority of its major peers and notably to trade at one month lows against sterling. Some positive figures were seen mid-week, with increases seen in new home sales and better than expected growth in the manufacturing sector, prompted a slightly better performance. A survey of leading economists released this week revealed that that around 50% of those surveyed believe that the Federal Open Market Committee (FOMC) would reduce the pace of bond-buying by $20 billion per month in September. Such a result would boost dollar performance in the medium term and as a result this survey had a positive effect, but a reduction is by no means assured at this stage and speculation will continue as further economic data comes through. Finally, yesterday’s Unemployment Claims data and Core Durable Goods Orders figures both fell short of expectations and failed to give the dollar a boost. Whilst medium term forecasts are still geared towards a US dollar recovery, we will need to see some improved data coming through before progress is made in the short term. The only real data of note coming in before the weekend is revised consumer sentiment data being released this afternoon by the University of Michigan. Call in now to see how the US dollar reacts to the latest data releases.

Worldwide

Elsewhere, the big mover early in the week was the Canadian dollar. The Canadian currency showed notable gains against the majority of its peers on Tuesday, with significantly better-than-forecast retail sales data injecting confidence into the Canadian market. This confidence continued, as the Canadian currency held steady through Wednesday, and gained further still yesterday off the back of oil price speculation. The New Zealand dollar, after a fairly weak day on Wednesday, was the standout performer yesterday off the back of the Reserve Bank’s interest rate decision. The rate was held at 2.50%, but investors were left with the impression that come the first quarter of 2014, rates could well be on the rise. The Japanese yen had a bit of a seesaw week, with demand for the low risk currency fluctuating as confidence in global stock markets wobbled. Today, inflation data out of Tokyo this lunchtime will be likely to have an impact on the Japanese yen. Otherwise, a fairly quiet day. Get in touch for the latest rates.

If you haven’t opened a Smart account yet, call on 0808 163 0102 (+44 0207 898 0541) or fill out our online Account Form

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Posted July 25th, 2013 by Charles Purdy

Will today’s Growth figures affect sterling? | Smart Daily Currency Note

GBP/EUR – 1.1614
GBP/USD – 1.5348
EUR/GBP – 0.8605
EUR/USD – 1.3212
GBP/AED – 5.6384
GBP/AUD – 1.6778
GBP/CAD – 1.5821
GBP/CHF – 1.4372
GBP/CNY – 9.4186
GBP/HKD – 11.9065
GBP/HUF – 343.62
GBP/INR – 90.544
GBP/JPY – 153.48
GBP/NZD – 1.9189
GBP/RUB – 49.98
GBP/SEK – 9.9607
GBP/THB – 47.689
GBP/ZAR – 14.967

Sterling

Sterling showed signs of weakness yesterday morning but largely recovered during the afternoon, until it fell sharply against the US dollar in the evening. The weakness experienced earlier in the day was seen in response to speculation by Goldman Sachs that there is a 50% chance that the Monetary Policy Committee will loosen monetary policy when they meet again in August. Sterling received a boost from the minutes of the last MPC meeting when it was revealed that the members voted unanimously in favour of maintaining the quantitative easing programme rather than increasing it. If there was a vote in favour of further asset-buying at the next meeting then this would have the opposite effect. However, after maintaining a reasonably strong upward trajectory for the past week sterling was still close to monthly highs against the dollar by the close of trading in London. Today sees the most important sterling data release of the week in the form of second quarter Growth figures. These are largely predicted to show consecutive growth, but expect volatility should we see any significant divergence between average predictions of 0.6% growth and the actual figure. Call in now to see how the Growth figures affect sterling performance.

Euro

There were signs of life coming from the 17-member state yesterday as strong manufacturing data out of Germany and France bolstered demand for the region’s assets. It triggering the euro to climb against the majority of its most-traded peers, and to 1-months highs against the US dollar before tumbling as Barack Obama began to speak. The euro gains were not as considerable as they might otherwise have been if it were not for the conservative monetary policy implemented by the European Central Bank. Nevertheless, the data out of Europe so far this week is encouraging, and could signal the start of a slight recovery in the latter parts of this year. The significant piece of data our of Europe today is the results from the German business climate survey, a good indication of wider European economic conditions. Get in touch for the latest euro news.

US Dollar

The US dollar had a mixed day yesterday trading at variable rates against sterling and euro throughout the day, but strengthened aggressively in the evening as Barack Obama began to speak about the US economy. The day’s economic data releases were marginally more positive than expected, with increases seen in new home sales and better than expected growth in the manufacturing sector. This prompted moderate dollar strength during the afternoon. The US dollar strengthened yesterday evening following comments from the US President on the state of the US economy where we suggested the US had “made it through the worst of yesterday’s winds“. Unemployment claims data is being released this afternoon and is likely to impact on the US dollar’s performance today as investors will be interested to see how the world’s largest economy is faring in its pursuit of an unemployment rate of 6.5%. Additionally, today’s monthly Core Durable Goods Orders data is a leading indicator of US production levels and has a similar potential to have a substantial impact on the performance of the dollar. Call in now to see if this fresh economic data can reverse US dollar fortunes.

Worldwide

Elsewhere, the major movements were shown by the New Zealand and Australian dollars yesterday, as the commodity-backed currencies stumbled for the first time in four days following the release of weaker than expected Chinese manufacturing data which showed further declines through July, hitting the lowest level for 11 months. Strong local trade balance figures out of Japan yesterday morning were not enough to prevent the yen falling against its major trading partners. Investors took confidence from tentative signs of recovery out of Europe, causing demand to fall for the low risk, low yield Japanese currency. The Canadian dollar held firm on yesterday’s strong performance. Last night the Reserve Bank of New Zealand met to make its decision on interest rates, and later today we have consumer inflation data coming out of Japan. Get in touch for the latest rates.

If you haven’t opened a Smart account yet, call on 0808 163 0102 (+44 0207 898 0541) or fill out our online Account Form

Posted July 24th, 2013 by Charles Purdy

Sterling steady as we await UK Growth data tomorrow | Smart Daily Currency Note

GBP/EUR – 1.1642
GBP/USD – 1.5383
EUR/GBP – 0.8588
EUR/USD – 1.3213
GBP/AED – 5.6502
GBP/AUD – 1.6612
GBP/CAD – 1.5841
GBP/CHF – 1.4399
GBP/CNY – 9.4436
GBP/HKD – 11.9349
GBP/HUF – 345
GBP/INR – 91.341
GBP/JPY – 153.51
GBP/NZD – 1.9282
GBP/RUB – 49.7285
GBP/SEK – 9.9201
GBP/THB – 47.572
GBP/ZAR – 14.948

Sterling

Sterling traded within a narrower range yesterday as we saw a decrease in volatility across the currency markets. The pound has made reasonably consistent gains since last week’s Monetary Policy Committee meeting minutes were released. A report from the British Bankers’ Association released yesterday morning showed that UK mortgage approvals increased during June, although this increase was marginally lower than expected. As a result, the data had little overall effect and sterling made good the slight losses it experienced earlier in the day against the US dollar and weakened very slightly against the euro. Preliminary UK growth data for the second quarter will be released tomorrow and is likely to have a strong bearing on performance as investors look to ascertain how much faith to put in a sustained economic recovery for the UK. Ahead of that, the Confederation of British Industry releases data detailing expected industrial orders over the next three months this morning, which may also have cause a degree of volatility. Call in now to see how sterling reacts.

Euro

The euro performed reasonably well yesterday, making modest gains against sterling and the US dollar. Consumer confidence data came through marginally better than expected, which fared well for the single currency. Having experienced little in the way of influential data coming from the Eurozone when compared with the UK and US, today sees a buck in the trend as investors will look to German and French Flash Manufacturing data as key indicators of economic strength. Marginal contraction is predicted in both countries, however varying figures, especially emanating from Germany could give rise to sharp movement. Call in now to see how to track the reaction from the euro.

US Dollar

After a tough few days for the US dollar following on from the Chairman of the Federal Bank’s report to Congress last week, yesterday provided some respite. The dollar saw little movement against sterling and weakened slightly against the euro. A Bloomberg survey of leading economists revealed that that around half of those surveyed believed that the Federal Open Market Committee (FOMC) would reduce the pace of bond-buying by $20 billion per month in September. Such a result would boost dollar performance in the medium term, but is by no means assured at this stage. Furthermore, it may still be some time before interest rates are increased following any reduction of asset-purchasing and whilst the outlook is generally positive for a US recovery in the long term, it may be some time before we see any substantial dollar rally. Whilst uncertainty reigns, speculation by key figures and incoming economic data releases will continue to cause volatility. One of such releases will be occurring this afternoon and comes in the form of New Home Sales data from the US. Monday’s Existing Home Sales data contributed to dollar weakness on Monday and traders will look to today’s figures as a further indicator of economic strength or lack of economic strength. Call in now to keep pace with market movements.

Worldwide

Elsewhere, the big mover yesterday was the Canadian dollar. The Canadian currency showed notable gains against the majority of its most-traded peers as a result of significantly better than expected retail sales data. The retail figures showed an impressive 1.9% increase in May, the biggest monthly jump in 3 years, quadrupling the 0.4% projections. These figures, off the back of strong wholesale and manufacturing figures last week, all point toward less slack for the Bank of Canada to continue its generous monetary policy. The Japanese yen, after a strong day yesterday, tumbled against all of the majors as certain over-exuberance receded following the weekend’s election result, in which fiscal and monetary policy stimulus supporter, Shinzo Abe, was given the nod from the populace. Overnight we saw trade balance data out of Japan and New Zealand, as well as Australian inflation data. This evening we also have short term interest rate decision out of New Zealand. Get in touch for the latest rates.

If you haven’t opened a Smart account yet, call on 0808 163 0102 (+44 0207 898 0541) or fill out our online Account Form

Posted July 23rd, 2013 by Charles Purdy

Will sterling benefit from the birth of a Royal baby? | Smart Daily Currency Note

GBP/EUR – 1.1645
GBP/USD – 1.5364
EUR/GBP – 0.8583
EUR/USD – 1.3189
GBP/AED – 5.6434
GBP/AUD – 1.6581
GBP/CAD – 1.5863
GBP/CHF – 1.4379
GBP/CNY – 9.4293
GBP/HKD – 11.9202
GBP/HUF – 342.79
GBP/INR – 91.647
GBP/JPY – 152.83
GBP/NZD – 1.9198
GBP/RUB – 49.6331
GBP/SEK – 9.9312
GBP/THB – 47.515
GBP/ZAR – 15.072

Sterling

Even before the announcement of a new Royal baby and the third in line to the throne, Sterling continued its upward trajectory yesterday as hopes for a sustainable economic recovery in the UK increased ahead of Thursday’s second quarter Growth figures. The pound made gains against the majority of its major trading partners and most notably continued to strengthen against the US dollar for the fifth day in a row as it was traded at the highest rate since June. Prime Minister David Cameron announced that improving economic conditions may allow the Coalition Government to implement tax cuts in the near future, lending further weight to sterling optimism. Thursday’s Growth data will be integral in determining whether we see sterling continue to appreciate. Further growth would lend support to the pound by giving credence to the notion of a sustainable economic recovery for the UK. Predictions range from around 0.3% to 0.8% growth, with most key figures expecting 0.6%. Speculation ahead of the release will continue to affect sterling performance and solid growth figures are likely to help sterling maintain its strong recent performance, but bear in mind that if the figures undermine the positivity seen in recent days then we are likely to see a sharp decline. Additionally, this morning sees the release of Mortgage Approval data from the British Bankers’ Association, which has the potential to have a more immediate impact on performance. Call in now to see whether sterling strength has continued.

Euro

The euro’s performance was largely dictated by events elsewhere yesterday as it made moderate movements to strengthen against the US dollar – reaching its highest level in a week – and weaken against sterling. The seventeen-nation currency derived some support from news that Portuguese Prime Minister Pedro Passos Coelho and his Government will remain in office for their full term as opposed to having to face elections which would have put the Portuguese compliance with their bailout plan in jeopardy. This is certainly positive news for the Eurozone, but perhaps did not have a strong an impact on the markets as events elsewhere. Not much influential data comes out today, but looking ahead to tomorrow, German and French flash manufacturing data will impact on euro performance. Call in now to track euro movement and for a live rate.

US Dollar

The US dollar performed poorly yesterday as a combination of a persistent uncertainty regarding the possible tapering back of the bond-buying programme and worse than expected existing home sales data caused the dollar to slide against the majority of its major peers. As expected, the US dollar’s sensitivity to economic data has increased following Ben Bernanke’s expressed commitment to an accommodative monetary policy and the reaction yesterday was negative. Most notably the US dollar traded at its lowest rate this month against a resurgent sterling. Whilst there is not a great deal being released today in the way of influential data impacting on the world’s largest economy, the temperamental dollar may still see movement in response to speculation regarding future monetary policy. Tomorrow sees the release of existing home sales data, which – as with the home sales data released yesterday – has the potential to cause further dollar volatility. Call in now to keep pace with dollar volatility.

Worldwide

Monday was a quiet day for the release of economic data elsewhere in the world. Sterling held its own or gained against the majority of other currencies as the feel good factor seems to be sticking to sterling for the short term. The main release today are the retail sales figures in Canada which are expected to show a modest improvement of 0.3%. Call in to see how the birth of a Royal Baby and the third in line to the throne is affecting sterling throughout the world!

If you haven’t opened a Smart account yet, call on 0808 163 0102 (+44 0207 898 0541) or fill out our online Account Form

Posted July 22nd, 2013 by Charles Purdy

Will Sterling’s good run continue? | Smart Daily Currency Note

GBP/EUR – 1.1610
GBP/USD – 1.5278
EUR/GBP – 0.8612
EUR/USD – 1.3160
GBP/AED – 5.6114
GBP/AUD – 1.6588
GBP/CAD – 1.5822
GBP/CHF – 1.4360
GBP/CNY – 9.4484
GBP/HKD – 11.8552
GBP/HUF – 341.74
GBP/INR – 90.48
GBP/JPY – 152.75
GBP/NZD – 1.9281
GBP/RUB – 49.3507
GBP/SEK – 9.9634
GBP/THB – 47.28
GBP/ZAR – 14.9641

Sterling

Sterling ended last week on a largely positive note having risen for four days straight against the US dollar and made notable gains against the euro. Sterling benefited from the Monetary Policy Committee minutes released on Wednesday which showed all nine members voting against increasing quantitative easing. Sterling also received some support from Friday’s Public Sector Net Borrowing data that revealed a slight reduction in the deficit during the month of June. Furthermore, a number of key figures predict that key UK GDP data due this Thursday will show an increase in growth during the second quarter giving performance an extra boost. Looking ahead to this week, the aforementioned GDP figures are likely to have a substantial impact upon sterling strength should they differ from last week’s predictions. Outside of this, there is not a huge amount of data being released this week with the potential to impact performance. Mortgage approval data – a leading indicator of demand for housing – has the potential to have some influence when it is released on Tuesday, but the GDP data on Thursday along with on-going speculation on future monetary policy are likely to fuel market movement. Call in now to track sterling’s performance this week.

Euro

The Euro stayed fairly range bound on Friday with no data of high impact being released. Although German Chancellor Merkel gave positive vibes whilst discussing the economy in Germany and the euro-zone, it had a muted effect on the markets. Perhaps with her looking for re-election in September, it was expected that she would remain optimistic. We have a quiet day again for the euro today, but with French and Germany manufacturing PMI data on Wednesday and Germanys Business Climate survey on Thursday, any unexpected data is likely to cause volatility for the currency. There are also increasing concerns for southern state debts and additional funding requirements. Portugal, Cyprus and Greece seem to be at the top of this list and could significantly increase instability for the Eurozone. So call your trade for the latest rates and updates.

US Dollar

After a highly volatile week, the US dollar weakened on Friday on the back of on-going concerns about the tapering back of US asset-purchasing. Now that Fed Chairman Bernanke has stated that US monetary policy will be highly accommodative, the US dollar seems to be highly sensitive to new economic data and speculation amongst investors. Despite the fact that ratings agency Moody’s upgrading the AAA credit rating of the world’s largest economy from negative to stable, the currency lost ground against most of its major peers. Given the current sensitivity to new data, this week we can expect the release of Existing Home Sales data on Monday to spark movement as these figures serve as a leading indicator of economic health. Likewise, New Home Sales data on Wednesday is likely to have some impact on the dollar’s performance. Finally, on Thursday traders will look to Unemployment claims data to reveal how the US is faring in its quest to meet unemployment targets. Expect plenty of volatility amidst a raft of data and on-going uncertainty about future monetary policy. Call in now to keep pace with market movements.

Worldwide

Elsewhere the Canadian dollar weakened on Friday following a government report showing inflation lower than the Bank of Canada’s target of 2%. The New Zealand dollar gained momentum with the People’s Bank of China (New Zealand’s largest trading partner) announced it is going to remove limits on lending rates. The Yen weakened against the US dollar leading up to upper-house elections in Japan, which will be closely watched. The South African rand also gained strength against the US dollar amidst doubts that the US may reduce stimulus as early as expected. Today we have core retail sales from Canada and New Zealand trade balance figures. Tomorrow we will have Chinese Flash Manufacturing Purchasing Managers index along with New Zealand interest rate statement. Call now the latest news and updates.

If you haven’t opened a Smart account yet, call on 0808 163 0102 (+44 0207 898 0541) or fill out our online Account Form

Posted July 19th, 2013 by Charles Purdy

Another roller coaster week for sterling | Smart Daily Currency Note

Last week                  This week
(GBP/EUR – 1.1591)   GBP/EUR – 1.1591
(GBP/USD – 1.5138)   GBP/USD – 1.5229
(EUR/GBP – 0.8624)   EUR/GBP – 0.8626
(EUR/USD – 1.3057)   EUR/USD – 1.3137
(GBP/AED – 5.5598)   GBP/AED – 5.5934
(GBP/AUD – 1.6523)   GBP/AUD – 1.6601
(GBP/CAD – 1.5688)   GBP/CAD – 1.5786
(GBP/CHF – 1.4365)   GBP/CHF – 1.4346
(GBP/HKD – 11.742)   GBP/HKD – 11.811
(GBP/INR – 90.864)   GBP/INR – 91.027
(GBP/JPY – 150.00)   GBP/JPY – 152.24
(GBP/NZD – 1.9266)   GBP/NZD – 1.9230
(GBP/SEK – 10.066)   GBP/SEK – 9.9832
(GBP/ZAR – 15.204)   GBP/ZAR – 15.046

Sterling

Sterling had a roller coaster week dropping to  a four month low against the euro and struggling against the dollar earlier this week as weaker than expected inflation data appeared to give the Bank of England more licence to keep monetary policy loose. This meant that all eyes were on Wednesdays release of the minutes from the first Monetary Policy Committee meeting with the new Governor Mark Carney in charge. What was revealed caught the market by surprise in that all 9 members voted in favour of maintaining the Bank of England’s quantitative easing target instead of increasing it. This caused sterling to jump over a cent against the US dollar and euro as many key figures expected the vote to show several members (including the new Governor Mark Carney) to vote in favour of increasing the quantitative easing program, rather than the unanimous decision against this that was revealed. Sterling was also boosted by the news that unemployment claims had dropped by over 20,000 in June, whilst retail sales figures released yesterday came out as expected. This morning sees the release of UK Public Sector Net Borrowing data and a high deficit can have a negative effect on sterling’s performance. Call in now to track developments.

Euro

It seems that the euro is not master of its own destiny this week as it continues to play a largely reactionary role whilst events in the UK and USA continue to dominate. The euro actually faired fairly well despite German economic sentiment proving to be worse than forecast. Current account data, showing the difference in value between imports and exports came in slightly worse than expected. Monthly German manufacturing data may impact performance of the single currency today. Additionally, it is worth noting that we have G20 meetings taking place on Saturday and discussions therein, may have implications for the euro and its major trading partners. Call in now for live rates and up to date information.

US Dollar

The US dollar had a poor start to the week as retails sales figures came in much lower than anticipated. Whilst typical estimates put growth at 0.8%, the figures revealed growth to be only at 0.4%, underlining the fact that recovery has been less convincing in the second quarter for the US. Many had hoped for some clarity regarding when the Federal Bank may look to start tapering its quantitate easing program when the Chairman of the Federal Reserve addressed congress this week; however, the Chairman asserted that a tapering of bond-buying must be based on consistent economic data and that a slowing in asset-purchasing would be likely to happen if US inflation made a determined move towards the 2% target (which this week came out showing an inflationary figure of only 0.2%). Some respite came yesterday as employment data released showed a better than expected drop in US unemployment claims in the previous month. However, whilst Bernanke remains committed to an accommodative policy the US dollar may continue to oscillate until we see the cumulative positive data that the Federal Open Market Committee is looking for. After an eventful week, there is less provocative data on offer today, although given sharp movements we have seen in recent days, some further volatility is not implausible. Call in now to keep pace with market movement.

Worldwide

Elsewhere, the Canadian dollar dominated much of the headlines this week as it weakened on Monday alongside falling commodity prices. Whilst manufacturing sales figures came out as expected, the Bank of Canada (with its new Governor at the helm) suggested that the economy remained sluggish and all but ruled out a potential interest hike in the near future causing the Canadian dollar to weaken further still. The Australian dollar performed well following the release of the minutes from the latest Reserve Bank of Australia rate setting meeting which outlined the central banks sentiment that interest rates were at an appropriate level, henceforth, seemingly removing the possibility of another rate cut in the near term. The Polish zloty also performed well following new government plans that will widen the budget deficit in order to boost the economy. Core inflation data released out of Canada will be the main release on the agenda, but, call Smart today for the latest news, and live quotes, for your currency.

If you haven’t opened a Smart account yet, call on 0808 163 0102 (+44 0207 898 0541) or fill out our online Account Form

Posted July 18th, 2013 by Charles Purdy

Sterling benefits from BoE surprise | Smart Daily Currency Note

GBP/EUR – 1.1574
GBP/USD – 1.5161
EUR/GBP – 0.8637
EUR/USD – 1.3099
GBP/AED – 5.5699
GBP/AUD – 1.6567
GBP/CAD – 1.5818
GBP/CHF – 1.4317
GBP/CNY – 9.3087
GBP/HKD – 11.7616
GBP/HUF – 339.78
GBP/INR – 90.419
GBP/JPY – 152.1
GBP/NZD – 1.9282
GBP/RUB – 49.0979
GBP/SEK – 9.993
GBP/THB – 47.106
GBP/ZAR – 14.943

Sterling

Sterling appreciated sharply yesterday morning in response to a double dose of positive data. The Monetary Policy Committee meeting minutes revealed a surprise 9-0 vote in favour of maintaining the Bank of England’s quantitative easing target instead of increasing it. This caused sterling to jump over a cent against the US dollar and euro as many key figures expected the vote to show several members (including the new Governor Mark Carney) to vote in favour of increasing the quantitative easing program, rather than the unanimous decision against this that was revealed. Performance was further boosted by data showing that unemployment claims dropped by over 20,000 in June, a much greater reduction than predicted. Sterling continued to perform well yesterday afternoon, trading at 1.16 against the euro and hovering above 1.52 against the US dollar. This morning sees the release of monthly UK retail sales data, which has the potential to either check or reinforce today’s optimism should figures differ significantly from predictions. Call in now to stay on top of continuing market reaction.

Euro

It seems that the euro is not master of its own destiny this week as it continues to play a largely reactionary role whilst events in the UK and USA continue to dominate. The euro weakened against sterling considerably yesterday morning and continued to decline throughout the day. The euro experienced more mixed fortunes in its performance against the dollar with reasonable movement seen in both directions, but little net movement, by the close of trading in London. Eurozone current account data, which details the difference in value between imported and exported goods may play some role in the euro’s performance today, as might Spanish 10-year bond data, but it is likely that events elsewhere may continue to dominate the headlines and drive market movement. Call in now to keep pace with developments and to get a live rate.

US Dollar

If investors were hoping for a clearer expression of intent from Fed Chairman Ben Bernanke, then they were certainly disappointed by his somewhat illusive report to Congress. Rather than laying out plans for future reductions in asset-buying, Bernanke remained accommodative and stated that the programme may be increased or tapered depending on economic conditions. Going forward this means that the US dollar is likely to be sensitive to changes in economic data in particular inflation data, as Bernanke stated that a slowing in asset-purchasing would be likely to happen if US inflation made a determined move towards the 2% target. Looking at the rates, the US dollar depreciated considerably against sterling in response to sterling strength, whilst a more mixed performance was registered against the euro. Bernanke will continue to testify to Congress today as US unemployment claims data is released as well as Philadelphia manufacturing data. Expect further volatility as markets react. Call in now to stay on top of developments and to receive a live rate.

Worldwide

Elsewhere, the Canadian dollar struggled yesterday after the Bank of Canada (with its new Governor at the helm) suggested that the economy remained sluggish and all but ruled out a potential interest hike in the near future. The Japanese yen struggled somewhat yesterday as confidence in the global markets grew. The Turkish lira was in the limelight once more as investors continue to speculate as to what action the central bank will take in the rate setting meeting next week. Overnight we saw the release of business confidence figures from Australia  and later on today wholesales sales figures may influence the relative strength of the Canadian dollar. Call Smart today for the latest news, and live quotes, for your currency.

If you haven’t opened a Smart account yet, call on 0808 163 0102 (+44 0207 898 0541) or fill out our online Account Form

Posted July 17th, 2013 by Charles Purdy

A difficult day for sterling lies ahead | Smart Daily Currency Note

GBP/EUR – 1.1491
GBP/USD – 1.5092
EUR/GBP – 0.87
EUR/USD – 1.3131
GBP/AED – 5.5434
GBP/AUD – 1.6387
GBP/CAD – 1.5689
GBP/CHF – 1.4204
GBP/CNY – 9.2549
GBP/HKD – 11.7069
GBP/HUF – 337.17
GBP/INR – 89.601
GBP/JPY – 150.18
GBP/NZD – 1.9205
GBP/RUB – 48.9434
GBP/SEK – 9.9609
GBP/THB – 46.896
GBP/ZAR – 14.924

Sterling

Consumer Price Index data from the UK, which gives an indication as to the current level of inflation, came in marginally worse than expected yesterday. This impacted on sterling’s performance as traders hedged their bets in the run up to the today’s publication of the minutes from Governor Mark Carney’s inaugural Monetary Policy Committee (MPC) meeting. Inflation has an important impact on performance as higher inflation should deter the MPC from further quantitative easing, which would devalue the currency, whilst lower inflation data would be seen as giving decision makers the go-ahead for increased asset-buying. The sterling dollar rate fluctuated throughout the day as both currencies reacted to negative stimuli, whilst sterling weakened steadily against the euro throughout the day. All eyes will be on the Bank of England report released this morning as we wait to see which way Carney and the other members voted on further quantitative easing. Call in now to track market reaction to the minutes and to get a live rate.

Euro

The euro performed surprisingly well yesterday despite German economic sentiment proving to be worse than forecast. As sterling and the US dollar falter ahead of today’s events, the single currency made steady progress yesterday and improved its position against both currencies. Events in the UK and the US are likely to steal the limelight today and will likely play a much greater role on influencing the relative strength on the euro as opposed to the data emanating from Europe in the short term although we do have a key vote in Greece on further government cuts to public expenditure. The only significant data release will be the German 10-year bond auction held today. Call in now to see how the seventeen-nation currency reacts.

US Dollar

The US dollar struggled yesterday as speculation grew that Chairman of the Federal Reserve Ben Bernanke will continue to deter hopes that we can expect a speedy scaling back of US bond-buying when he delivers his monetary policy report to Congress over the course of today and tomorrow. His words last week made traders hesitant to back the dollar ahead of the report. The US dollar fell consistently against the euro, whilst the dollar sterling rate experienced volatility, with sharp movements in both directions as both currencies struggled. US Consumer Price Index data, a key inflation indicator, failed to have a significant impact as predictions proved to be largely accurate for the month of June at 0.2%. Whilst the Chairman of the Federal Reserve’s report to Congress is expected to steal the headlines across the Atlantic, we also have another member of the Federal Open Market Committee speaking as well as a the release of the Beige book which will reveal the state of the local economies from all 12 Federal Reserve Banks. Call in now to see how the report is received.

Worldwide

Elsewhere, the Australian dollar was one of the best performers yesterday following the release of the minutes from the latest Reserve Bank of Australia rate setting meeting which outlined the central banks sentiment that interest rates were at an appropriate level, henceforth, seemingly removing the possibility of another rate cut in the near term.  The Polish zloty also performed well yesterday following new government plans that will widen the budget deficit in order to boost the economy. The Canadian dollar remained fairly range bound as manufacturing sales figures came out as expected, however, you can expect the markets to become nervous ahead of the Bank of Canada’s rate setting meeting and press conference this afternoon. Call Smart today for the latest news, and live quotes, for your currency.

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Posted July 16th, 2013 by Charles Purdy

Sterling still feeling the heat | Smart Daily Currency Note

GBP/EUR – 1.155
GBP/USD – 1.5125
EUR/GBP – 0.8655
EUR/USD – 1.3094
GBP/AED – 5.5549
GBP/AUD – 1.6462
GBP/CAD – 1.5766
GBP/CHF – 1.4316
GBP/CNY – 9.2802
GBP/HKD – 11.7323
GBP/HUF – 337.49
GBP/INR – 89.752
GBP/JPY – 151.03
GBP/NZD – 1.9293
GBP/RUB – 49.2213
GBP/SEK – 10.0682
GBP/THB – 46.974
GBP/ZAR – 14.9576

Sterling

Sterling experienced some movement yesterday, losing some ground against the US dollar during the morning, but largely making good those losses in the afternoon. There was also little overall movement against the euro as data released from Smart Currency partner Rightmove Plc showed that asking prices for UK housing had risen again to a record high. The most imposing event on the horizon for sterling is the publication of the minutes of the Bank of England’s most recent policy meeting, which may give traders cause to react as everyone looks to get the measure of Mark Carney. Should it transpire that Carney voted in favour of further quantitative easing then we are likely to see a sharp decline for sterling. In the meantime, today sees the release of Consumer Price Index data, which is the most important indication of the current level of inflation in the UK. Higher than expected inflation may lend some support to sterling ahead of the release of the policy meeting minutes tomorrow, whilst lower figures would have an inverse effect. Call in now for a live rate from your trader and to keep pace with developments.

Euro

Yesterday saw little in the way of influential data emanating from the Eurozone and its performance was largely defined by events elsewhere. Little net movement was seen against sterling or the US dollar by the close of trading in London. Today we can look to German economic sentiment data to impact upon performance as traders looks for signs of optimism from investors and analysts in Europe’s largest economy. Today also sees the release of Core Consumer Price Index and trade balance data from the Eurozone, but it is Germany’s economic sentiment data that is likely to play the biggest role. Call in now to track its effect and to receive a live rate.

US Dollar

The US dollar enjoyed a reasonably strong morning yesterday, making reasonable gains against sterling and euro as a number of key figures made optimistic predictions for the US retail sales data. However, earlier gains were quickly wiped out when the figures revealed less growth than expected. Whilst typical estimates put growth at 0.8%, the figures revealed growth to be slightly lower at 0.4%, underlining the fact that recovery has been less convincing in the second quarter for the US. Commentators expect the US economy to continue its recovery over the coming months, however figures such as yesterday’s show that the recovery could be sporadic and any negative data is likely to lend credence to the hesitancy that Fed Chairman Bernanke expressed last week regarding the tapering back of the US bond-buying programme. Thus today’s US Core CPI data, giving an indication as to the level of inflation in the world’s largest economy, has the potential to cause further movement if figures differ from predictions. Call your trader now to keep pace with developments and to get a live quote.

Worldwide

Elsewhere, the Japanese yen struggled yesterday in part due to the disparity in future monetary policy in Japan versus the US. The Canadian dollar also struggled yesterday alongside falling commodity prices and ahead of the Bank of Canada rate setting meeting on Wednesday. Overnight we saw the Reserve Bank of Australia release the minutes from its latest monetary policy meeting and later on today we have manufacturing sales figures released from Canada. Call Smart today for the latest news, and live quotes, for your currency.

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Posted July 15th, 2013 by Charles Purdy

Sterling slips as the UK awaits the BOE meeting minutes | Smart Daily Currency Note

GBP/EUR – 1.1568
GBP/USD – 1.5101
EUR/GBP – 0.8641
EUR/USD – 1.3052
GBP/AED – 5.5464
GBP/AUD – 1.6595
GBP/CAD – 1.5698
GBP/CHF – 1.4314
GBP/CNY – 9.2679
GBP/HKD – 11.7151
GBP/HUF – 337.09
GBP/INR – 90.44
GBP/JPY – 150.2
GBP/NZD – 1.933
GBP/RUB – 49.24
GBP/SEK – 10.0604
GBP/THB – 47.031
GBP/ZAR – 15.051

Sterling

Sterling slipped away a little on Friday, breaking through 1.51 and 1.16 against the US dollar and euro respectively. This week is a lot livelier on the news front than last with influential releases coming most days. Tomorrow sees annual CPI figures as well as other inflation data. On Wednesday markets get further insight into how the new Governor of the Bank of England will run his bank with the release of the minutes from the first meeting under his charge. On Thursday we have Retail sales figures, a key indication of consumer spending and growth in the country, markets will keep a keen eye on the release though the forecasts are not overly positive. Call your trader this week for the very latest news, and up to the second rates for sterling.

Euro

The euro stayed broadly flat through Friday’s trading in spite of somewhat disappointing manufacturing production figures. The major events this week are an influential German economic sentiment survey released tomorrow morning which is expected to show increased optimism. A bond auction on Thursday will show how much it costs the Spanish government to borrow money , but little else is scheduled to be released. Get in touch with Smart this week for an update on where the euro is trading right now.

US Dollar

The US dollar got back into the groove on Friday as markets came to realise that, whether or not tapering of quantitative easing is to happen right away, the trend of monetary policy either side of the Atlantic appears to be moving in opposite directions. Those hoping for last week’s excitement to have died down may well be disappointed with influential data being released most days. Today is retails figures, tomorrow inflation and Thursday sees Federal Reserve Chairman Bernanke speak again. Last time he spoke the US dollar dropped 2.5 cent – markets will certainly be nervous as he takes the stage again. Call us today for a live rate on the US dollar.

Worldwide

Elsewhere the biggest loser on Friday was the Australian dollar, slipping 1.5% against its American counterpart. Overnight tonight eyes will look south again, with quarterly inflation figures from New Zealand, and the minutes from this month’s Australian Monetary Policy Committee meeting. Later in the week, no change is forecast when the Bank of Canada announces its interest rate decision, and their new governor steps into Mark Carney’s old shows and hosts a press conference. Call Smart today for the latest news, and live quotes, for your currency.

If you haven’t opened a Smart account yet, call on 0808 163 0102 (+44 0207 898 0541) or fill out our online Account Form

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