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Posted October 14th, 2013 by Charles Purdy

Will the US default on its debt?

The US dollar ended last week with little major movement, as nothing of note drove the currency in either direction. Speculation over the on-going government shutdown and the fast approaching debt ceiling held further optimism that an agreement will be reached to raise the debt limit, and thus avoid a default, and as such has given encouragement for the US  dollar going forward. However, a preliminary consumer sentiment from the University of Michigan came in lower than expected, harming the economic outlook. This week starts with a bank holiday in the US, so no data, but more volatility in a less liquid market. Tomorrow also holds little of significant interest for the US dollar, with just Empire State manufacturing index being mildly influential data, and words from a member of the Federal Open Market Committee. Wednesday is equally uneventful, while Thursday finally brings some important releases, holding both the unemployment claims, an important factor in the albeit delayed tapering program conditions, and the manufacturing index from the Philly Fed. That, however, is it for major US data for the week, as Friday finishes off a largely quiet week for data releases with only FOMC members words liable to have any impact on the currency. Aside from this, any developments with the government shutdown  and raising of the debt ceiling will sure to be of interest to investors. Get in touch with your trader now for the latest news on the debt ceiling.

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Posted September 18th, 2013 by Charles Purdy

Will they, won’t they taper – we await the Federal Reserve’s announcement

Yesterday was again a disappointing one for the US dollar, struggling ahead of the FOMC monetary policy decision this evening. After months of speculation, tonight will reveal if the Federal Reserve has decided to taper its quantitative easing program and if so, how aggressively it decided to reduce the amount of asset purchase on a monthly basis. Encouraging signs from the US economy in the past few months has lent support to the introduction of tapering; however, labour data release in the past month has fallen short of market estimates. At present, analysts are suggesting the Federal Revere will decide to reduce the amount of asset purchased it makes on a month basis by $5-15 billion (currently $85 billion a month). This prediction is thought to be largely priced into the market; however, any significant variation away from these levels and we are likely to cause a significant amount of volatility across the market. Building permits released this afternoon could provide further possible volatility ahead of tonight’s central bank decision. Get in touch with your trader now for an up to the minute price on the US dollar, on the most important day for the currency in recent weeks.

Posted September 16th, 2013 by Charles Purdy

Will the Federal Reserve start to taper?

The US dollar finished off last week in disappointing fashion, as a number of economic indicators failed to meet expectations. Both sets of retail sales figures and the preliminary consumer sentiment data all came out worse than predicted. This prompted investors to lessen their expectations of the Federal Bank aggressively reducing its stimulus package at this weeks Federal Open Market Committee (FOMC) meeting as it appears the economy is not recovering as fast as expected. As a result, even if the central bank does decide to start to taper its quantitative easing program, many now believe the cuts would be moderate and in turn won’t have as big a reaction in the markets as first anticipated. Today, no major data is due from stateside but tomorrow will bring the more influential core consumer price index data. Wednesday holds the biggest event risk of the week where we will see if the FOMC decides to taper its quantitative easing program and if so, how aggressively it chooses to taper. Alongside this announcement, the central bank will give an overview and outlook on the US economy. Other data released this week includes existing home sales figures, the Philadelphia manufacturing index and several members of the FOMC will be speaking on Friday. Call your trader now to hear the latest rates on the US dollar, in a crucial week for the currency.

Posted August 30th, 2013 by Charles Purdy

US dollar strengthens as fears of Syrian concerns mounts

Developments in Syria helped the US dollar to strengthen through the course of the week in spite of mixed data being released. As the threat of military action looms (although this threat subsided somewhat yesterday), investors have been looking to what are seen as the safer currencies – of which the US dollar is one – in order to minimise their risk. As such, we have seen the US dollar make decent gains against most of its partners throughout the course of the week. Data from the country this week has been mixed, with pending home sales and core durable goods orders being behind estimates, while consumer confidence and preliminary GDP came in ahead of predictions. Following the Federal Open Market Committees (FOMC) minutes released last week, all data becomes important as it influences the possibility of the Federal Reserve tapering its quantitative easing program, which many feel may well commence as early as next month. As such, the comments coming from the speech made by one of the members of the FOMC today may well influence the market. Furthermore, we have consumer sentiment figures, inflation data and personal spending data released. Get in touch with your trader now for the latest rates on the US dollar, as both internal and external factors affect it.

Posted August 27th, 2013 by Charles Purdy

Emerging market currencies perform well on Friday

Elsewhere on Friday saw the markets lean towards a more risk-on approach. With little mention of tapering of the quantitative easing programme released from the FOMC minutes, the markets took this as a positive sign and investors started buying the so-called riskier currencies, with the emerging market currencies doing particularly well. Also, in line with the Euro’s strong week we saw the Scandinavian currencies have a positive finish to the week as fears surrounding the Eurozone crisis quietened down and the higher interest rates of these currencies attracted investors. Japanese inflation figures will be released on the 29th and on the same day Canada has its PMI data released with a figure over 50 giving the currency a boost and then on Friday we have Canadian growth figures released. Get in touch for a live rate.

Posted August 22nd, 2013 by Charles Purdy

Sterling steady despite disappointing public sector finances

Yesterday was a strong day for sterling, as it rose over the day against 14 out of its 16 most traded partners, with one measure showing it had erased its year-to-date decline. Within this, further 2 month highs were reached against the US dollar, ahead of the release of the minutes from the Federal Open Market Committee (FOMC) meeting. All of this came about even after it was shown that the UK had recorded its first budget deficit for July since 2010. The only other data out for the pound yesterday was the industrial order expectations which came out ahead of expectations and helped to further strengthen the currency by adding to mounting positive economic data for the country. Today, there is once again no UK related data due for release so a quiet day could be expected as a result of this, although further reaction to events elsewhere could produce a knock on effect for the currency. Call your trader now for the latest price on the pound, on a day likely to be more influenced by outside factors.

Posted August 22nd, 2013 by Charles Purdy

Europe awaits influential PMI figures

Yesterday had little of note to speak of for the euro, as no data came out from the Eurozone to make any drastic changes to strength of the multi-nation currency. The major shift was seen as losses against a strengthening US dollar before the release of the FOMC meeting minutes, while against the majority of partners little change was seen over the course of the day. First thing this morning we have influential manufacturing and services Purchasing Managers’ Index (PMI) figures out of France and Germany, two of the major economic forces in the Eurozone as well as the overall figures for Europe as a whole. Positive results have the potential to have a big effect on the strength of the euro. At the same time, important data from around the world could still impact the euro. As such, it promises to be an interesting day for the euro, so get in touch for a live rate.

Posted August 22nd, 2013 by Charles Purdy

FOMC meeting minutes leave us no clearer on when “tapering “ could commence

The US dollar strengthened yesterday in anticipation of the release of the latest FOMC meeting minutes. Speculation in anticipation of the release of these saw the currency extend gains against the majority of its main partners and also on the back of existing homes sales data, which showed that this measure had increased last month to the fastest pace since November 2009. This was yet another positive sign to add to the ever growing list implying the increasing strength and recovery of the US economy. Whilst almost all members of the FOMC agreed that it was appropriate not to alter the quantitative easing program in July, there was no clarity with regards to when the tapering should commence as some members urged for patience whilst others pushed for the tapering to begin sooner rather than later. That being said, there was a general acceptance regarding the timeline laid out by the Chairman of the Federal Reserve with the program ending around the middle of next year. The immediate reaction in the market following the release was fairly muted, however the US dollar has since strengthened. Get in touch with your trader now for an up to the minute price for the US dollar as the reaction to yesterday’s important events continues.

Posted August 21st, 2013 by Charles Purdy

Euro reaches six month high against the US dollar

On what was a relatively quiet day for data releases we saw the euro post gains amongst most of its major trading pairs peaking at a 6 month high against the US dollar at 1.3455. Some of this strength may be accredited to comments from the German finance minister who suggested that growth in Europe’s powerhouse could surpass current expectations. We must also look at forthcoming events; a likely reason is the end of the euro-zone’s technical recession in the second quarter and may give reason for the ECB to actually consider raising interest rates a lot sooner than expected. This possible rate rise was spoken about on Monday in the Bundesbank monthly report and the market reacted well to it despite the President of the ECB’s recent negative comments. Another factor could be rescheduling of Greece’s debt. Concern has been expressed recently by German and French officials over the ability of Greece to keep up with its payment schedule, although they are suggesting a drastic cut as before. Although any succession may well be seen as positive for the euro. Today, we have no data with the highlight of the week being Thursday’s Purchasing Managers’ Index (PMI) data release a figure above 50, is considered euro positive. Call in now for the latest update on the euro.

Posted August 21st, 2013 by Charles Purdy

The US dollar struggles in anticipation of FOMC meeting minutes

Yesterday held no data for the US dollar either, and as such markets were tentative, especially in preparation for today’s main event, namely the release of the minutes from the Federal Reserve Open Committee’s meeting. With the repeated mention of tapering continuing to dominate the news surrounding the currency, these minutes could prove crucial should they give a better idea of the expected date for the bond buying process to be slowed, while some people see the current speculation surrounding this as nothing more than a guessing game. Nonetheless, it is still in the forefront of investors’ minds, as when it is implemented we can likely expect the dollar to gain traction, as the current printing of money brings weakness to the currency. Before all of this today though, existing home sales data could impact the currency if they were to come out either side of expectations. Get in touch with your trader now for a live price on the US dollar ahead of a day that could prove instrumental in the currency’s performance in the coming weeks.

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