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Posted February 27th, 2013 by Charles Purdy

The Italian elections continue to worry markets | Smart Daily Currency Note

GBP/EUR – 1.1532
GBP/USD – 1.5114
EUR/GBP – 0.8665
EUR/USD – 1.3082
GBP/AED – 5.5514
GBP/AUD – 1.4786
GBP/CAD – 1.5492
GBP/CHF – 1.4077
GBP/CNY – 9.47
GBP/HKD – 11.7152
GBP/HUF – 341.49
GBP/INR – 81.03
GBP/JPY – 138.50
GBP/NZD – 1.8304
GBP/RUB – 46.16
GBP/SEK – 9.7372
GBP/ZAR – 13.3356

Sterling

Sterling had a mixed day yesterday – starting off on the front foot reaching highs of 1.1650 against the euro and 1.5220 against the US dollar before losing ground later in the day. Sterling struggled after one of the Monetary Policy Committee (MPC) members from the Bank of England (BoE) suggested he was open to more monetary easing and furthermore, that the prospect of negative interest rates had been raised at central bank meetings. Furthermore, realised sales data from the Confederation of British Industry (CBI) came out lower than expected. Out today we have the second estimate of the UK’s fourth quarter GDP which is expected to show a contraction of 0.3%, the same as the first estimate. Moreover, more MPC members will be speaking today, and following yesterday’s volatility, the market will pay close attention to what they have to say. Call now for the latest updates on sterling.

Euro

It has been a turbulent few days for the euro, news of the inconclusive Italian election yesterday drove the euro to a seven week low against the dollar – whilst weakening by three cents against sterling. The damage was not as widespread as first feared however, as traders became confident that the European Central Bank (ECB) would intervene to limit the fallout, and the euro strengthened in the afternoon. Today is likely to be just as volatile with two important events. Firstly, we expect an Italian 10 Year Bond auction this morning – a key way for governments to borrow money and high yields mean high borrowing costs for the Italian Government. Secondly, in the afternoon the ECB President is speaking in Germany, we traditionally see a great deal of volatility during his speeches as markets look for hints as to future monetary policy. Get in touch now for the latest news and rates.

US Dollar

The US dollar generally performed well yesterday, strengthening against the majority of its currency partners with Consumer Confidence figures and New Home Sales data (rising in January to the highest since 2008) both coming out much better than expected. Along with this, the Federal Reserve Chairman backed the central bank’s current stimulus program, saying that they will support the asset purchases with “little risk of inflation or asset-price bubbles” causing the dollar to strengthen further. In the testimony he stated that “We do not see the potential costs of the increased risk-taking in some financial markets as outweighing the benefits of promoting a stronger economic recovery.” Although he also warned that the automatic federal budget cuts in line to begin 1st of March will add a “significant” burden to the economy if lawmakers are unable to avert from the reductions. Today we will see Core Durable Goods orders along with the second part of the Chairman of the Federal Bank’s “congressional testimony” on monetary policy.

Worldwide

Elsewhere, the Canadian dollar fell to a eight month low versus the US dollar following better than expected data out of the US and the comments from the Chairman of the Federal Bank. The commodity backed currencies struggled in general yesterday whilst the Japanese yen prospered due to risk aversion driving the markets and traders seeking safer havens for their money. The Russian rouble was one of the worst performers yesterday after GDP data released showed that the economy had contracted by 0.3%. Call in now for a market update and a live quote.

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Posted August 26th, 2010 by Charles Purdy


EURO/GBP – 1.223
US$/GBP – 1.553
CHF/GBP – 1.599
CAN$/GBP – 1.640
AUS$/GBP – 1.751
NZD/GBP – 2.209
EURO/US$ – 1.270

Sterling had a fairly quiet day yesterday and remains range bound against the euro and US dollar. With trading volumes still low due to the holiday season any negative surprises could hit confidence in sterling and lead to larger movements than normal. Today sees the release of the CBI Distributive Trade Survey which gives an indication of how retailing activity has faired in August. Get in touch now to speak to our traders so you can plan ahead accordingly.

The euro was initially well supported on Wednesday after the German IFO business climate (survey for German business sentiment) unexpectedly rose in August. Germany are clearly benefitting from a weaker euro as they are an export driven economy. The euro had been under pressure due to risk aversion as Ireland’s sovereign credit rating was downgraded by Standard and Poor. Today sees the release of economic data which should confirm that the pace of contraction in loans to non-financial corporations are continuing to ease. Call in now for a live exchange rate.

The US dollar continues to benefit against the euro and sterling as investors pile into safe haven assets due to the uncertainty surrounding the future for the global economy. Today is a relatively quiet day for the US dollar so ensure you are taking advantage of any movements in your favour by speaking to a trader today.

Elsewhere the Canadian dollar rebounded from the weakest level in almost two months as equities rallied and crude oil rose. The Canadian dollar is strongly correlated to the price of crude oil as it is its biggest export.

Exchange rates change every second – call Smart Currency Exchange for a live up-to-the-minute quote on our Freephone number: 0808 163 0102 (+44 (0)207 898 0541 from outside the UK) or fill out our online quote form at: SmartCurrencyExchange.com/quote.aspx

Posted July 14th, 2010 by Charles Purdy


EURO/GBP – 1.198
US$/GBP – 1.525
CHF/GBP – 1.613
CAN$/GBP – 1.573
AUS$/GBP – 1.726

Sterling rose yesterday against the US dollar after inflation data remained above the Bank of England’s target rate. The CPI year on year inflation figure fell from 3.4% for May to 3.2% for June. The Bank’s target rate is 2.0%, and many investors felt that yesterday’s figures showed that inflation is stubbornly high and may prompt the Bank of England to raise interest rates earlier than predicted. Many currently expect this to start happening in the second quarter of next year, but the figures yesterday meant there was speculation that this could happen sooner. As a result the pound recovered by nearly 1% on the previous day, hitting a high of $1.5258/ £1 in early trading this morning – recovering from $1.4949/ £1 on Monday. Out today there is claimant count unemployment data for the UK, which is expected to show a drop of 20,000 and a more inclusive measure of employment is likely to show little growth in the sector. Call in now to ensure you are not losing out to the current volatility.

In the Euro zone, data released yesterday showed that economic confidence fell in Germany. The ZEW economic sentiment survey is a key measure of European sentiment as a whole, and it showed a worse than expected drop from 28.7 to 21.2. Overall though, the euro has taken a slight backseat this week against key data from the UK, and the euro held its ground against the pound – maintaining a price below 1.20/£1. Out later today we have inflation and industrial production data for the euro zone. Call in now to make sure you don’t miss out.

In the USA, retail sales for June are expected to show a small monthly rise. Retail sales fell by 1% in May, and the trade balance unexpectedly worsened as data out yesterday showed that the deficit had widened by $2.3bn. Get in touch now for a live exchange rate.

Elsewhere, New Zealand’s retail sales slumped by 0.2% in June – far less than the expected 0.6% upturn and marking the second month’s consecutive decline. Australian consumer confidence jumped by 11.1% – the most in 13 months – presumably related to the ousting of former Prime Minister Kevin Rudd. Call in now for a live exchange rate and to effectively plan your next payment.

Exchange rates change every second – call Smart Currency Exchange for a live up-to-the-minute quote on our Freephone number: 0808 163 0102 (+44 (0)207 898 0541 from outside the UK) or fill out our online quote form at: SmartCurrencyExchange.com/quote.aspx

Posted July 13th, 2010 by Charles Purdy


EURO/GBP – 1.196
US$/GBP – 1.499
CHF/GBP – 1.594
CAN$/GBP – 1.553
AUS$/GBP – 1.721

Sterling fell against the US dollar on Monday after concerns resurfaced over the UK’s triple A credit rating. Standard & Poor’s said it was maintaining the negative outlook on Britain’s economy as the challenging spending cuts announced in the recent emergency budget have yet to be made and the economy may not grow as fast as the government has predicted. Despite the recent budget announcement, the government has yet to implement the required spending cuts and this is what concerns the credit rating agency. Elsewhere, GDP for the 1st Quarter remained unchanged at 0.3% and the current account deficit unexpectedly jumped by £5bn. The key data today is the UK inflation figures, which are likely to show a decline from last month’s annual rate of 3.4% – reflecting the spare capacity of the economy. Mervyn King has been saying for some time that inflation will fall off through the year – justifying his decision to keep interest rates and the asset purchase programme on hold. Call in now for a live exchange rate.

In the Euro zone, news has just been announced that Portugal’s credit rating has been downgraded. This reflects the ongoing concerns over sovereign debt in the region, and yesterday saw the euro give back gains to the US dollar and pound on concerns on what bank ‘stress testing’ would uncover. Recent euro strength – against sterling and US dollar – has been seen as a reflection of weakening prospects in the UK and the USA and not as a reflection of any reduction in the issues surrounding sovereign debt in the region. Out today, there is economic sentiment data released. Call in now for a live exchange rate.

In the USA, the US dollar gave back some of the gains made against the pound. However, the US dollar is still holding firm below the $1.50/ £1 level – currently trading at $1.4990/ £1. Out later today there is trade balance data which is expected to show a narrowing in the trade deficit. Call in now to make sure you buy at the best price.

Elsewhere, the New Zealand dollar benefited overnight and was the best performing currency against the US dollar after speculation over interest rate hikes saw investor expectations increase. A survey showed that many are expecting a rise of 130 basis points – up from 118 points the other week. Higher interest rates mean better returns for investors, therefore demand increases for the currency and it strengthens. Call in now to ensure you don’t miss out.

Exchange rates change every second – call Smart Currency Exchange for a live up-to-the-minute quote on our Freephone number: 0808 163 0102 (+44 (0)207 898 0541 from outside the UK) or fill out our online quote form at: SmartCurrencyExchange.com/quote.aspx

Posted June 29th, 2010 by Charles Purdy


EURO/GBP – 1.231
US$/GBP – 1.505
CHF/GBP – 1.636
CAN$/GBP – 1.571
AUS$/GBP – 1.750

Sterling had a strong day yesterday, climbing to a 1 ½ year high against the euro and a 7 week high against the US dollar. The pound jumped to 1.2250/ £1 and $1.5104/ £1 as the UK currency continued to benefit from last week’s tight emergency budget. Investors speculated that the Euro zone debt problems would leave the region much weaker than the UK after the new coalition’s tight budget was received well by the financial markets. Many analysts see this as the budget that whips the economy into shape. However, gains against the US dollar have been muted, as many analysts feel that last week’s post-budget gains went too far. Another boost for the pound came as everyone’s favourite Bank of England member Andrew Sentence stated that the latest budget would not remove the need for interest rate hikes in the coming months. Out later today, there is monthly lending data and also data on mortgage approvals. Even though the markets have been moving up, there is nothing to stop the pound dropping – call in now to ensure that you secure the best rate.

In the Euro zone, monthly inflation data for Germany came in as expected but money supply data showed that the amount of money in the European economy had shrunk by 0.2%. There is little data out today aside from a European commission report on confidence in the region which is expected to show relatively stable readings. Sentiment towards the Euro zone has seen a relative drop compared to the UK as the emergency budget was released – call in now, especially if you have euros to move into sterling as we could see 1.25/ £1 a lot sooner than many would like.

In the USA, inflation data for consumer purchases came in slightly better than expected at 0.2% but data on personal income showed a drop of 0.1% on the month. Out later today, consumer confidence data is released that some are expecting to show a slight decline. Get in touch and speak to a trader to ensure that you don’t lose out on strong rates.

Elsewhere, Japan’s unemployment rate unexpectedly rose in May as the economy shed 240,000 jobs. These figures show how much the Japanese economy relies on overseas trade to drive domestic demand, especially given how China currently has to curb the excessive growth of its economy. Get in touch now to ensure that you don’t lose out.

Exchange rates change every second – call Smart Currency Exchange for a live up-to-the-minute quote on our Freephone number: 0808 163 0102 (+44 (0)207 898 0541 from outside the UK) or fill out our online quote form at: SmartCurrencyExchange.com/quote.aspx

Posted June 28th, 2010 by Charles Purdy


EURO/GBP – 1.216
US$/GBP – 1.504
CHF/GBP – 1.633
CAN$/GBP – 1.557
AUS$/GBP – 1.723

Sterling had a strong week last week as tough spending cuts announced in the emergency budget eased fears amongst investors that the UK would suffer a debt crisis akin to Greece or Spain. The pound hit a 19 month high of 1.22/ £1 and held above the $1.50/ £1 level for the first time in nearly 5 weeks. A new trend emerged that clearly showed the budget helped separate the UK from the rest of Europe in the eyes of investors. Normally, when European stock markets have fallen in the last few months, the pound has followed suit against the euro. However, last week, we saw sterling hold strong in the face of faltering European markets. With little UK data out today, the focus is on the general risk trends. Many analysts feel that there is not enough positive impetus to push the pound beyond $1.50/ £1 – get in touch now to avoid missing out.

In the Euro zone, stock markets are set to rise this morning after Asian markets strengthened overnight. The rally was caused as fears eased that the US senate would draft a harsh banking regulation bill. There had been concerns that at the meeting of the G20 leaders over the weekend, the leaders would co-ordinate some sort of global financial regulation package, but as it was the summit proved fairly inconclusive. The general outcome seemed to be that every country had slightly different issues to contend with and as a result, the respective governments would do things their own way. European money supply data out today is expected to show a further contraction in the rate of growth. Sentiment towards the region is still poor – get in touch now for a live price.

In the USA, the focus this week is on Non-Farm payroll data (released Friday), house prices, manufacturing data and spending/ income data. An improvement in May employment and hourly earnings could mean that both income and spending data shows an improvement also. In addition, overnight the People’s Bank of China set the Chinese yuan’s daily mid-point at a new post-revaluation. This revaluation has been praised by the USA as it makes US goods more competitive, however, the real motive behind the revaluation is probably to keep a lid on China’s overheating economy. Call in now for a live exchange rate.

Elsewhere, a report from the National Bank of New Zealand showed that consumer confidence fell in the region by the largest amount since October 2008. The reason behind the drop was falling expectations of growth in various industries. A survey by Credit Suisse shows that many traders are forecasting an interest rate rise of 131 basis points over the next year despite this poor confidence. Call in now to speak to a trader, as there is a lot of volatility likely on the NZ and AUS dollar.

Exchange rates change every second – call Smart Currency Exchange for a live up-to-the-minute quote on our Freephone number: 0808 163 0102 (+44 (0)207 898 0541 from outside the UK) or fill out our online quote form at: SmartCurrencyExchange.com/quote.aspx

Posted June 25th, 2010 by Charles Purdy


EURO/GBP – 1.210
US$/GBP – 1.492
CHF/GBP – 1.643
CAN$/GBP – 1.554
AUS$/GBP – 1.726

Sterling extended gains yesterday and hit the highest level since November 2008 against the euro after renewed sovereign debt fears in Greece contrasted sharply with a new found optimism that the UK budget cuts will rein in the country’s record deficit. Following the new government’s emergency budget, investors are now confident that the UK is well on the way to being on a stable financial footing again. One of the big drivers yesterday was investors buying back sterling after placing extreme bets that the pound would fall. This extra demand has seen the pound at a 5 month high against a basket of major currencies, after peaking yesterday at 1.2222/£1 and $1.5011/ £1. We have the G8 meetings going on today, and any positive rhetoric will continue to have a strong effect on the pound. Get in touch now for a live price.

In the Euro zone, yesterday saw Greek debt take centre stage again after the cost of insuring against Greek government default jumped to record levels. The market in this type of insurance gives investors a very clear picture of the sentiment towards the region, and the record cost meant that the euro fell yesterday with one analyst at French bank Societe Generale expecting the pound to hit 1.25/ £1 soon. Data out today in the Euro zone is expected to show that German import prices have increased by 2% in May – up 9.5% on last year. France’s GDP growth is expected to remain unchanged at 0.1% for the quarter. Call in now for a live exchange rate.

In the USA, the final estimate of GDP for the 1st Quarter is expected to be uneventful with growth forecast to remain unchanged at 3% year on year. This ends a relatively disappointing week for the US economy – particularly from housing data. On the other hand, jobless claims fell unexpectedly by 19,000 which came as a welcome surprise. Next week’s June employment report will give a clearer picture of the Labour market in the USA. We are looking at particularly good sterling strength against the US dollar – get in touch now to avoid losing out.

Elsewhere, the Australian and New Zealand dollars fell around 0.6% against the US dollar as Asian stocks fell in overnight trade and impacted on risk appetite for the higher yielding ‘riskier’ currencies. New Zealand’s trade balance surplus widened to a record high of NZ$4.2bn, however the outlook looks poor as Chinese demand is set to lag over the coming months.

Exchange rates change every second – call Smart Currency Exchange for a live up-to-the-minute quote on our Freephone number: 0808 163 0102 (+44 (0)207 898 0541 from outside the UK) or fill out our online quote form at: SmartCurrencyExchange.com/quote.aspx

Posted June 24th, 2010 by Charles Purdy


EURO/GBP – 1.218
US$/GBP – 1.495
CHF/GBP – 1.654
CAN$/GBP – 1.555
AUS$/GBP – 1.722

Sterling hit a 6 week high against the US dollar of $1.4999/£1 after sentiment was given a large boost. Firstly, following the emergency budget on Tuesday, credit rating agency Moody’s stated that the UK will retain the AAA credit rating if it successfully implements Tuesday’s measures. In addition, investors were in for a shock when the Bank of England’s minutes for this month’s meeting on monetary policy showed that one of the Bank members voted for a rise in interest rates – the first time for over 2 years that anyone has voted for a rate hike. With VAT set to rise to 20% and a round of tough spending cuts, the affirmation from Moody’s should ease investor concern over the UK. As a result, the pound saw a welcome boost. However, many analysts said that whilst the rise was justified, there are still genuine concerns over the possibility that the cuts and tax hikes could stifle out growth. As a result, many expect that the pound will not have the momentum to push far past $1.50/ £1 for some time. Get in touch now to take advantage of the best price in 6 weeks.

In the Euro zone, the euro fell against the pound as investors flocked to sterling. The pound hit 1.2189/ £1 at one point yesterday. Sentiment towards the euro is still poor, as Portugal announced that borrowing from the ECB by banks in the country doubled in May to a new record level. Banks in the region are having to borrow directly from the central bank, as they face difficulties borrowing on the ‘interbank’ market. The interbank market is where banks borrow money on a short term basis (e.g. overnight) to pay obligations. Due to poor sentiment in the region, the interest rates for overnight lending are prohibitively high and banks are going to the central bank for financing. Out today, we have some retail sales and industrial data – call in now for a live exchange rate.

In the USA, the Federal Reserve kept interest rates on hold. And the language in their statement was slightly more pessimistic than last month, suggesting that an interest rate hike by the end of the year will be less likely. This added to the US dollar’s losses against the pound. Out later today, we have US durable goods orders which are expected to drop marginally for the month. Call in now for a live price.

Elsewhere, the Australian prime minister has resigned due to unpopularity over a ‘super-tax’ on natural resources companies. This has boosted mining stocks and has seen some Aus dollar strength overnight, as the threat of punishing taxes on Australia’s biggest economic earners has now receded. Get in touch for a live exchange rate.

Exchange rates change every second – call Smart Currency Exchange for a live up-to-the-minute quote on our Freephone number: 0808 163 0102 (+44 (0)207 898 0541 from outside the UK) or fill out our online quote form at: SmartCurrencyExchange.com/quote.aspx

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