Sterling sees some light but will it last? | Smart Daily Currency Note
GBP/USD – 1.5724
Sterling performed extremely well yesterday especially against the euro regaining the two cents it lost on Friday which highlights how quickly things can change and how volatile markets continue to be. This is a vast improvement on recent trends despite disappointing construction Purchasing Managers Index (PMI) data being released . As noted, the greatest improvement came against the euro, rising by nearly two cent to over 1.166 – recovering from the 15-month low of 1.1475 we saw on Friday afternoon. Reasons given for the recovery were firstly that sterling was ‘over-sold’ and traders took profits and secondly the markets realised that the Eurozone still has some very significant problems that need to be resolved. Having said that it is still important to remember that the fundamental issues that drove sterling weaker still remain. Today see’s the release of important Services PMI data which is an important indicator of current economic health. Call in now to see if sterling can continue to recover from the heavy losses it has incurred of late.
The US dollar performed fairly well yesterday in the absence of significant data being released from the US and as risk aversion drove the market due to the uncertainty developing in Europe. Today could well see a similar trend with the US dollar taking its cue from elsewhere as the only major data release is the Services PMI figures. The last few months Services PMI releases have come in above expectation and if this week’s figures are as positive we can expect markets to react favourably. Good news, especially if backed up by unemployment data on Thursday could indicate that recovery is well underway on the other side of the Atlantic, and drive risk appetite. As the economic health of the region looks up, it may well only be the threat of March’s super-cliff that weighs on prices. Call in now for an update and to get a live price from your trader.
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