Pound gains against Euro & Dollar

Overview of Yesterday's Trading
The pound gained yesterday, hitting the highest level in over a week against the US Dollar. The main reason for the rise was the rise in global equities coupled with the easing of risk aversion.

As I have said all week, the swine flu situation has given investors the jitters, and in uncertain times like that, funds flow back to the safe haven currencies such as the US Dollar and Yen.

The fear now seems to have subsided, and as funds move back to the currencies that are percieved to be a higher risk such as Sterling, exchange rates have risen.

The FTSE rose by over 2% also yesterday, which also supported the pound, in particular against the US Dollar and JPY. Also helping the pound was the better than expected retail sales data for the UK, which has given slight hope that the UK economy may be starting to recover.
I've talked about the Euro all week, so today we'll take a closer look at some of the other major currencies - the US Dollar, New Zealand Dollar and Yen. Of course do contact me if you would like to discuss Pounds to Euros.
GBP/USD





Here we see the steady rise of rates for pound to dollars. The Fed kept their rates on hold yesterday as expect. It has broken through 1.49 this morning, so good buying opportunities here following the Federal Open Markets Committee Statement which has weakened the USD.
Although the economic outlook had "improved modestly" since its meeting last month
economic activity is going to"remain weak for a time", the Fed said. These statements are what have started to weaken the dollar.
Today we have lots of data for the states, so don't expect exchange rates to stand still today. We have Jobless Claims, Personal Consumption, Personal income, Persinal Spending and the Puchasing managers Index, so get in touch if you wish to discuss your USD requirements if you are buying or selling.
GBP Sterling to New Zealand Dollar






Yesterday I predicted that the RBNZ would cut their rates by 0.5%, and indeed they did. I also predicted the exchnage rate would slightly rise, and indeed it did - although as you can see it has already started to come back down. As you can see from the above chart it is clear when the announcement was made, and exchange rates for the Kiwi spiked.

Even though the move was widely predicted in advance, investors still chose after the decision to sell of NZD which weakened the currency, boosting the rate of exchange. At close yesterday the rate was 2.56. It hit a high of 2.62 and currently 2.5970. For any clients looking to buy NZD, you may wish to consider taking advantage of this spike in rates while it is available.
So, what for today?
There's lots of data out today. We have already had some unemployment data for both Germany and the EU, which was not too far away from forecasts, and so not much change in the GBP/EUR rate.
UK
We have already had the Nationwide house prices which were better than expected. Prices still fell, but not as much as expected. Consumer confidence is weaker than it has been for many years and the property market will not recover until it returns, so no change for Sterling really following the news.
Japan
The interest rate was left on hold at 0.1% this morning as expected, as of course there is no room to cut rate any more. We also have a host of data from Japan tonight, if the JPY is the currency you are interested in, please get in touch for detailed analysis of what is happening with this currency following the general strengthening this week.
We've already talked about the swine flu strengthening the yen, but also Industrial output in Japan rose in March for the first time in six months, according to government figures. This boost for the economy has helped the currency, but of course have driven down GBP/JPY rates.

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