ECB President talks down the euro which benefits sterling | Smart Daily Currency Note
This week (Last week)
GBP/USD – 1.5724 (GBP/USD – 1.5856 )
Yesterday proved the theory that it is easier to talk down a strong currency e.g. the euro rather than boost a weak currency e.g. Sterling as the European Central Bank President hinted at possible euro interest rate cuts. This resulted in Sterling having a strong end to the week – pushing back above the 1.17 level against the euro and the 1.57 level against the US dollar. The incoming Governor of the Bank of England Mark Carney gave evidence to a committee of MPs and he quelled speculation that he would look to extend stimulus programs (which would further weaken sterling), saying that it is "entirely…probable that the current stance of policy is consistent with the economy achieving escape velocity." The Bank of England later held interest rates, implying that the Monetary Policy Committee also agree that, given time, the status quo will suffice. Other data released this week produced much better than expected Services Purchasing Managers Index (PMI) but the construction figures disappointed the market. Today is not likely to hold as much excitement, the key question being, with very little data released; can the pound hold the ground it has won back? Get in touch to find out.
The US dollar has had a relatively strong week – reaching an 8 month high of 1.5630 against sterling, a 2 week high of 1.3380 against the euro and is headed towards the 94 line against the Japanese yen (already at a three year high). This week, a speech from President Obama sought to limit the size of the super cliff by addressing matters before it really comes to a fore. Unemployment data released was more or less as expected as was the outcome of Services PMI data showing an industry expansion figure of 55. Important import/export data released today should show more positive data from the US as the States look to play-down fears surrounding the US fiscal cliff. Call in now for an update and to get a live price from your trader.
Get in touch now for a live price and to see if the US can avoid tumbling off the so-called fiscal cliff. For individual requirements, visit the SmartCurrencyExchange.com website and for companies visit the SmartCurrencyBusiness.com website