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Posted November 30th, 2008 by Charles Purdy

Weekly US$ rates and comments – week commencing 1st December 2008

Sterling made steady gains throughout last week against the US$ and the €, owing more to issues within the American and European economies rather than from anything positive from recent UK market data. The pre-budget speech by Alistair Darling last Monday did little to move sterling on the markets. However, one mildly positive note was the release from Nationwide on Thursday of house prices falling less than was expected over the past month. The upside potential for sterling is quite possibly limited by the prospect of another aggressive cut in interest rates from the Bank of England this week. Should the base rate be slashed by 2%, down to 1% as some suspect may be the case, sterling may well find itself losing significant ground once more this year. Even if the reduction is smaller, the downside risk is still significant.

 

A US$800bn dollar stimulus package announced by the Federal Reserve on Tuesday saw the US$, currently at 1.538/£1 continue to weaken across the board. This again reminded the world that despite its recent popularity as a low-risk asset, shortcomings within the financial sector in the US will continue to impact the value of the US$ for some time to come. The American markets were on holiday for Thanksgiving and, despite weak data being released consistently over last week, losses against the euro were pared back by weak European data on Friday.

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Posted November 24th, 2008 by Charles Purdy

Weekly US$ rates and comments – week commencing 24th November 2008

Sterling edged up through last week away from the record lows of the previous. The shock of reaching such a low level against the euro which many had considered as inconceivable has forced a re-think of how much further down sterling could fall with further interest rate cuts becoming more of a certainty as inflation  Continue Reading…

Posted November 17th, 2008 by Charles Purdy

Weekly US$ rates and comments – week commencing 17th November 2008

Sterling is in the pits. The constant stream of increasingly negative data over the last year as well as the gloomy outlooks on the year ahead have left a sad picture of the UK economy. The recent flurry of well publicised job cuts and the ever growing sense of an impending recession (that may or  Continue Reading…

Posted November 10th, 2008 by Charles Purdy

Weekly US$ rates and comments – week commencing 10th November 2008

The Bank of England’s move to slash interest rates in the UK last week from 4.5% to 3% was surprisingly well received by the markets and it is hoped the decision will shock the flagging UK economy back into life. Despite rates being at their lowest for 53 years, there were suggestions following the announcement  Continue Reading…

Posted November 3rd, 2008 by Charles Purdy

Weekly US$ rates and comments – week commencing 3rd November 2008

Sterling rose steadily against the euro throughout a relatively quiet week for market data. Closing last week only marginally up against the US$ despite another period of high price volatility the sterling to US$ rate moved in a huge range over the last five days of around 8%. The reductions in LIBOR (inter-bank lending rates),  Continue Reading…

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