A new month but no new dawn for sterling | Smart Daily Currency Note
This week (Last week)
GBP/USD – 1.5856 (GBP/USD – 1.5786 )
Thursday finally saw some good news for sterling, having been in decline versus its most-traded peers for the majority of the week. The impacts of considerably worse than expected 4th quarter GDP data released last Friday, combined with increasing global economic confidence – most notably across the Eurozone – continued to dampen demand for the British currency early this week. There was a slight respite for sterling on Wednesday, as news emerged that one of the Bank of England’s key policy makers suggested 2013 economic growth is likely to be much higher than previously estimated. Yesterday’s news that both consumer confidence and house prices had risen from last month’s figures saw a small amount of positive sentiment return to the UK economy, helping edge sterling away from its thirteen month and five month lows versus the euro and US dollar respectively. Today sees the release of key Manufacturing Purchasing Managers’ Index (PMI), likely to give a clear insight into the current extent of UK economic recovery. Having seen shocking manufacturing data earlier this month, any decline is likely to further weaken demand for sterling. Call in now for the latest news and to get a live price.
It has proved to be a difficult week for the US dollar, losing ground versus many of its major trading peers. A continued rise in economic confidence throughout the Eurozone significantly weakened demand for the US dollar, seeing it fall to the lowest level versus the euro since November 2011. News that fourth quarter GDP data had showed a contraction of 0.1% – the first decline in growth since 2009 – did little to decrease global risk appetite. This continued to dampen demand for the US currency, seeing it lose some of its previous gains versus sterling, returning towards 1.59 by Thursday afternoon. It was a better weak versus the Japanese yen, reaching the highest level since June 2010. Mixed unemployment data earlier in the week should render today’s key Non-Farm Unemployment figures hugely influential. Call in now for the latest news and to see how it has impacted the dollar.
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