Sterling makes steady gains against the euro | Smart Daily Currency Note
GBP/USD – 1.5432
Sterling drifted through yesterday without making many waves and gaining slightly against the euro. This was despite the market starting to develop nerves as to the impact that the new Bank of England Governor Mark Carney may have when he starts on Monday. Modest gains in mortgage approvals indicate a recovering property market, matched by realised sales figures, perhaps Mr Carney is taking the reins of a horse that is finally gathering some speed. The incumbent Governor Mervyn King speaks this morning on economic stability, a speech which looks likely to be largely a hand over speech. We can generally expect volatility while he is speaking as traders listen for hints as to future monetary policy. Call your trader now for up to the second rates.
The US dollar climbed yesterday as three key sets of data exceeded expectations. Core Durable Goods orders, not expected to rise, added 0.7% to last month’s release. Consumer confidence, and New Home sales compounded the effect later in the afternoon adding support to a rising dollar and a recovering American economy. Positive fundamentals from the States are likely to have an exaggerated effect on currency values in light of the Federal Reserve’s recent taper talk – a strengthening economy suggesting that a winding up of quantitative easing is close. Today is far quieter, the only major release being quarterly GDP figures. The preliminary figures were released a month ago meaning any effect will likely have already been seen – though any deviation from the 2.4% growth would shock markets. Call your trader to find out where the US dollar is trading now.