Showing posts from July, 2010

Sterling falls against stronger Euro

30th July 2010
Good morning. Sterling to Euro rates fell yesterday throughout the day, dropping from €1.20 down to the low €1.19's. The reason for the fall was better than expected confidence data from the EU, which strengthened the single currency making it more expensive to purchase. Rates at 08:30am are as follows:
GBP/EUR 1.1957GBP/USD 1.5620GBP/AUD 1.7368GBP/NZD 2.1637GBP/CAD 1.6156GBP/CHF 1.6218GBP/ZAR 11.424GBP/JPY 134.84GBP/NOK 9.499EUR/USD 1.3059Euro strengthens

The Euro-zone data was again stronger than expected with gains for business confidence while there was a further decline in German unemployment which helped underpin sentiment towards the economy. The better data was welcomed by the markets, and the single currency gained strength throughout the day. The good data coupled with more confidence in the bank stress tests mean investors are happier to have funds in Euros.

Sterling remains firm despite Euro strength

The latest UK mortgage lending data was weaker than expecte…

Pound remains firm despite BoE Comments

29th July 2010
Good morning. The US Dollar came under month end selling pressure yesterday, and has helped push GBPUSD rates through $1.56 which is the best for 5 months. Against the Euro, rates remain around the €1.20 level. At 08:30am this morning rates are as follows:

GBP/EUR 1.1994GBP/USD 1.5627GBP/AUD 1.7363GBP/NZD 2.1547GBP/CAD 1.6156GBP/ZAR 11.402GBP/CHF 1.6460GBP/JPY 136.42GBP/HUF 339.49EUR/USD 1.3026Pound remains firm

Despite comments from the Bank of England yesterday that interest rates would remain low for some time, the pound remains firm. Usually I would expect such comments to drive the pound down, however investors seem to be happy with the better UK data of late, and so there was no real sell off for Sterling following the comments.

Analysts said the overall tone of the BoE testimony suggested few policymakers for now would warm to the views of rate setter Andrew Sentance, who has argued for a rise in UK interest rates at the past two policy meetings.

Analysts said for now…

Sterling to Euro rates gain after Retail Sales

28th July 2010
Good morning. UK Retail sales yesterday were much better than expected, indicating sustained growth in the UK. The news pushed Sterling higher, and rates this morning at 08:30am are as follows:

GBP/EUR 1.1969GBP/USD 1.5585GBP/AUD 1.7409GBP/NZD 2.1303GBP/CAD 1.6065GBP/CHF 1.6505GBP/ZAR 11.386GBP/JPY 137.02GBP/NOK 9.5998EUR/USD 1.3018
UK Retail Sales

A survey by the Confederation of British Industry showed retail sales rose at their fastest pace in three years in July. The Distributive Trades Survey, which covers 20,000 outlets, said sales were expected to keep growing next month. The CBI's head of economic analysis said that Retailers are optimistic that strong sales growth will continue next month, which is promising.

We still expect the recovery in overall consumer spending to be fairly restrained however, given concerns about the impact of public spending cuts outlined in the budget.

Sterling rose close to €1.20 against the Euro, and we're also close to $1.56 agains…

Sterling hits 5 month high against USD, falls against Euro

Good morning. The pound has hit a 5 month high against the US Dollar yesterday, but a stronger single currency means that pound to Euro rates have retreated back well below the €1.20 level. At 08:30am rates are as follows:

GBP/EUR 1.1917GBP/USD 1.5481GBP/CAD 1.5946GBP/AUD 1.7151GBP/NZD 2.1046GBP/CHF 1.6313GBP/ZAR 11.353GBP/JPY 134.86GBP/NOK 9.534EUR/USD 1.2986Pound gains against US Dollar

After last weeks stress tests and the better than expected GDP data, markets have more confidence investing in riskier currencies such as Sterling. The pound has since pushed higher against the US Dollar, and we're now seeing the best buying levels in 5 months for those needing to purchase US Dollars.

Pound falls against Euro

The stress tests seem, for the moment, to have allayed concerns over the EU economy. A bullish set of data late last week showed the European economy may be doing much better than previously thought. The news has helped to push the Euro higher, making it more expensive to purcha…

Sterling up on GDP and stress test results

26th July 2010
Pound vs Euro

Last week we witnessed a relatively volatile week for Sterling/Euro exchange rates with the difference between the high of €1.2003 and the low of €1.1717 - just over the 2.3% mark, a significant difference when transferring thousands of pounds overseas.

The main news of the week that caused the volatility came from the Bank of England minutes and UK Gross Domestic Product figures which were released on Wednesday and Friday morning respectively. The minutes showed that as expected the Monetary Policy Committee had voted in the same fashion as they had in June. Andrew Sentence remained the only member looking for an interest rate hike of 0.25% while the seven other members all voted for a rate hold at the record low of 0.5% a figure which has now been in place for 16 months.

Many had thought Mr Sentence may have found support from some of the other committee members and the likelihood of a rate increase in August would be a high possibility, but with the news …

How will stress tests affect exchange rates?

23rd July 2010
Good morning. There are some key things today that will likely cause some volatility in exchange rates. For the UK, we have the 2nd Quarter GDP figures that will show if the economy is growing. The main news today though is the EU bank stress tests. More on that in a moment, first the usual snapshot of rates as at 08:30am:

GBP/EUR 1.1889GBP/USD 1.5310GBP/AUD 1.7127GBP/NZD 2.1070GBP/CAD 1.5852GBP/ZAR 11.379GBP/CHF 1.5973GBP/JPY 133.06GBP/NOK 9.4505EUR/USD 1.2874UK Gross Domestic Product
The figures are released at 09:30am. The GDP is considered as a broad measure of the UK economic activity and health. We expect the figures to show a quarterly growth of 0.6% and an annual growth of 1.1%. If the figures are worse than this, expect Sterling exchange rates to fall. GDP indicates if we are recovering from the recession, and so the figures are watched closely by the currency markets.

EU Bank StressTests
The health of Europe's banks will come under scrutiny again later, when t…

Pound and Euro weak ahead of GDP and stress tests

22nd July 2010
Good morning. The BoE minutes yesterday showed only 1 member voted for a rate hike. This weakened the pound slightly, however continued Euro weakness meant GBP/EUR rates actually rose slightly. Exchange rates at 08:30am are as follows:
GBP/EUR 1.1874GBP/USD 1.5190GBP/CAD 1.7281GBP/AUD 1.7281GBP/NZD 2.1221GBP/CHF 1.5875GBP/JPY 131.50GBP/ZAR 11.451EUR/USD 1.2788BoE Interest RatesSterling fell against the dollar and euro yesterday after minutes from the Bank of England showed further easing was discussed. Only 1 member voted for a rate hike, and the pound fell slightly as a result. Policymakers gave a downbeat tone on growth, even as they warned near-term inflation would remain high.Euro weakens pushing GBP/EUR rates upThe single currency weakened further in anticipation of the bank stress tests, due tomorrow. European policy makers have expressed confidence their banks would pass the tests, though some analysts said investors remain skeptical about the severity of the healt…

What caused Sterling to fall then gain against the Euro?

21st July 2010
Good morning. Yesterday Sterling fell after weaker than expected public finance data. After dropping around 1 cent against the Euro in the morning, the pound recovered all it's losses in the afternoon. Today we'll look at what's causing the movements, and what's in store for the pound when the BoE release their minutes this morning. First, the usual snapshot of rates @ 08:30am:
GBP/EUR 1.1857GBP/USD 1.5305GBP/AUD 1.7280GBP/NZD 2.1265GBP/CAD 1.5850GBP/CHF 1.6083GBP/ZAR 11.542GBP/JPY 133.36GBP/HUF 339.08EUR/USD 1.2896Sterling falls due to Public spending data

Yesterday figures showed that net borrowing was worse than expected. The ONS also said total government debt was now equivalent to 63.9% of the UK's annual economic output, the highest since that measure began in March 1993. The figures pushed Sterling lower against most currencies, dropping to the low €1.17's against the Euro. Later in the day however, Euro weakness caused rates to bounce back.


Pound falls to 7 week low against Euro

20th July 2010
Good morning. Sterling fell to it's lowest level in nearly 2 months yesterday as the Euro gained against most major currencies. Today we'll look in detail at the developments in the EU that's causing the single currency to gain, and what may happen later in the week with Sterling. First, the usual snapshot of rates as at 08:30am:
GBP/EUR 1.1777GBP/USD 1.5283GBP/AUD 1.7385GBP/NZD 2.1434GBP/CAD 1.6059GBP/CHF 1.6077GBP/ZAR 11.597GBP/HKD 11.880GBP/JPY 132.72EUR/USD 1.2969
Euro gains against SterlingYesterday exchange rates fell into the mid €1.17's. as the euro staged a broad recovery from lows hit last week after a credit rating downgrade on Ireland and on concerns about Hungary. According to Reuters a large euro buy order early yesterday pushed the Euro higher across the board, prompting investors to shrug off news elsewhere and cut their euro short positions against a number of currencies, including sterling. The net result is the Euro surged and GBP/EUR rat…

Pound to Euro forecast w/c 19th July 2010

Pound vs Euro

Last week we witnessed a relatively quiet week for Sterling/Euro exchange rates with little more than a 1% movement between the high and low of the week prior to Fridays trading session. The movements did show greater volatility on Friday seeing a 1.3% drop for Sterling across the day. This movement came as a surprise to many after the Eurozones trade balance figures came out significantly worse from a prediction of 0.8bn to an actual reading of -3bn.

The strength for the single currency following this was a shock and shows that the obvious doesn’t always happen in the currency markets. One of the tools best suited to this kind of scenario is a stop loss order, where a minimum level can be placed in to the market protecting clients from any market downturn. Speak to your account manager today for more information on the various tools at our disposal to maximize your individual requirement.

One of the principle theories behind Fridays rally for the Euro came from comments ma…

Pound GBP to Euro EUR forecast / predictions 2010

Today we'll have a detailed look at the pound to euro exchange rate, what's caused it to climb this year, why it's fallen recently, and what the rest of the year may have in store.

Sterling fell against the Euro on Thursday, with analysts citing the Spanish bonds news as strengthening the Euro, making it more expensive to purchase. A weaker dollar also helped GBP/USD rates push to the highest in several months, as markets worried about the strength of U.S. economic recovery.

Where GBP/EUR rates have moved through 2010 Here we see the GBP/EUR rate for the last 3 months. As you can clearly see, rates steadily increased but have since fallen. The reasons for the steadily increasing rate are two fold. Firstly, the pound has recovered significantly since the budget was announced by the new coalition government. The robust measures announced to raise taxes and cut spending in order to reduce the deficit were well received by the markets, allaying concerns investors had about the eco…

Pound gains on employment data

Good morning. Unemployment fell yesterday helping boost the pound against the US Dollar. Rates remain steady against the Euro though due to a stronger single currency. Rates as at 08:30am 15th July 2010 are as follows:

GBP/EUR 1.2004GBP/USD 1.5271GBP/AUD 1.7423GBP/NZD 2.1246GBP/CAD 1.5814GBP/CHF 1.6090GBP/ZAR 11.489GBP/NOK 9.5309GBP/JPY 134.37GBP/HUF 333.70UK Unemployment

The number of people unemployed in the UK fell by 34,000 figures showed yesterday. The number of people in work rose by 160,000. However, the increase was due to a record 148,000 rise in the number of part-time workers, while full-time workers increased by just 12,000.

The UK figures will raise hopes that the economic recovery is gaining momentum. Although some experts think unemployment could start rising again by the end of next year. Andrew Sentance, a member of the Bank of England's Monetary Policy Committee, said in a speech on Tuesday that the labour market had stabilised.

This stabilising market combined with …

Sterling rises on inflation data

Good morning. Sterling rose yesterday, after data showed that inflation is still above the BoE's target. This added fuel to the argument for higher interest rates, boosting Sterling exchange rates. As at 08:30am 14th July rates are as follows:
GBP/EUR 1.1965GBP/USD 1.5221GBP/AUD 1.7224GBP/NZD 2.1161GBP/CAD1.5668GBP/ZAR 11.406GBP/HKD 11.832GBP/NOK 9.4777GBP/JPY 135.33EUR/USD 1.2721 Inflation Figures boost SterlingThe consumer price index yesterday came in roughly as expected, although still well above the Bank of Englands target. Analysts said the data helped to boost sterling on the view that ongoing price risks may require the BoE to raise rates earlier than expected by the market, which sees the central bank starting to tighten in the second quarter of 2011. When interest rates are thought to rise, it usually supports the currency concerned due to the higher return. In a speech on Tuesday, one MPC member said the BoE should start raising rates because economic conditions are impr…

Interest Rates and Exchange Rates

Good morning. Both the UK and EU left interest rates on hold as expected yesterday. Comments from the ECB however strengthened the Euro and caused rates to fall slightly. As at 08:30am 9th July rates are as follows:
GBP/EUR1.1957GBP/USD 1.5179GBP/AUD 1.7332GBP/NZD2.1440GBP/CAD 1.5826GBP/CHF1.5952GBP/ZAR 11.455GBP/JPY 134.14GBP/HKD 11.813GBP/DKK 9.9107EUR/USD 1.2692Interest Rates

As expected, there were no moves in interest rates for either the UK or EU yesterday. There was no comment after the BoE decision, so we'll have to wait 2 weeks for the minutes of the decision, to see how many of the 9 member committee voted for a hike. If the minutes show that some voted for an increase, it will likely boost the pound and cause exchange rates to rise.

The comments from the EU after their decision gave some support to the single currency, and it pushed GBP/EUR rates down to the mid €1.19's.

Today's Data

We have some inflation data from the UK today. If higher than expected, then this…

Sterling, Euro & Aussie Dollar forecast

Good morning. Easing concerns about the EU banking sector mean that riskier assets are now sought by investors. For exchange rates, this means the pound is now at a 2 month high versus the US Dollar. Against the Euro however, the stronger currency means we're still at the €1.20 mark. At 08:30am 8th July 2010 rates are as follows:
GBP/EUR 1.2003GBP/USD 1.5178GBP/AUD 1.7360GBP/NZD 2.1474GBP/CAD 1.5872GBP/CHF 1.6006GBP/ZAR 11.495GBP/HKD 11.819GBP/NOK 9.6713GBP/JPY 133.84EUR/USD 1.2640Sterling

Today is significant, as we have a raft of UK economic data that could affect exchange rates. We have house prices, Industrial and Manufacturing production, and an interest rate decision. It's expected that several of the 9 member committee will vote for an interest rate increase, although overall rates will likely be left on hold at 0.5%.

Sterling may be supported this morning, but after the decision we could see a retraction if rates are indeed left on hold. We'll have to wait 2 weeks …

Pound falls below €1.20 against Euro

Good morning. Sterling has fallen below the €1.20 mark in trading yesterday, and is now significantly lower than the highs we saw last week. Analysts expect the Euro to continue making ground against Sterling. At 08:30am this morning rates are as follows:
GBP/EUR 1.1995GBP/USD 1.5092GBP/AUD 1.7796GBP/NZD 2.1787GBP/CAD 1.5951GBP/CHF 1.6028GBP/ZAR 11.531GBP/JPY 131.48GBP/NOK 9.6896EUR/USD 1.2579Sterling fallsThe pound has fallen against most currencies, as investors have renewed confidence in the Eurozone. Increased investment has caused the single currency to bounce back. Sterling has dipped slightly due to poor economic data, and fears that recovery may be longer than expected. Where may rates move today?The main news today is from the EU. Gross Domestic Product figures are released at 10:00am this morning. This is a measure of the economy as a whole, and can have a significant impact on exchange rates. We expect the monthly figure to show 0.2% growth. The Annual figure is expected to …

Sterling slips on poor PMI data

Good morning. The pound fell yesterday after weaker than expected Purchasing Managers Index data highlighted the fragility of the economic recovery. Sterling exchange rates at 08:30am 6th July 2010 are as follows:
GBP/EUR 1.2078GBP/USD 1.5202GBP/AUD 1.7903GBP/NZD 2.1854GBP/CAD 1.6108GBP/CHF 1.6121GBP/ZAR 11.671GBP/HKD 11.839GBP/JPY 133.40GBP/HUF 343.16EUR/USD 1.2585Sterling falls on PMI dataThe figures indicated that there would be a slow down in the growth of the economy in the second part of the year. The pound had been enjoying a rise against most currencies, after the tightest budget in a long time seemed to ease investors concerns.

There seems to be a clear gap between the UK method of recovery, and that of the EU and US. We have cut spending in a big way in order to reduce the deficit as soon as possible. Elsewhere, fiscal stimulus continues, as there are fears that cutting too much too quickly could knock the fragile recovery.

Markets seem to prefer the UK method at the moment, an…

Sterling exchange rate forecast

Good morning. Exchange rates remain strong against most currencies this morning, although the GBP/EUR rate is still lower due to a stronger Euro. Renewed confidence in the EU banking sector has boosted the Euro and caused GBP/EUR rates to fall. At 09:00am 5th July rates are as follows:
GBP/EUR 1.2106GBP/USD 1.5177GBP/AUD 1.8007GBP/NZD 2.1974GBP/CAD 1.6106GBP/CHF 1.6133GBP/ZAR 11.688GBP/JPY 133.30GBP/CHF 1.6135EUR/USD 1.2534 This week’s dataThe main event for the week is the interest rate decisions for the EU and UK on Thursday. While rates will be left on hold, any comments that indicate future interest rate movements can have a big impact on exchange rates. Contact us today for a free consultation on how economic data can impact on the cost of your currency purchase. MondayUS Holiday for Independence Day. For the EU we have Retail Sales for Germany and the EU as a whole, in addition to some confidence measures. IN the UK we have a measure of inflation.If it’s higher than expected then…

Pound climbs against USD, falls against EUR

Good morning. Sterling rose against most currencies yesterday except the Euro. The single currency has become stronger over the last few days as European bank funding concerns eased. At 08:30am 2nd July 2010 are as follows:
GBP/EUR 1.2128GBP/USD 1.5190GBP/AUD 1.7941GBP/NZD 2.1955GBP/CAD 1.6097GBP/JPY 133.39GBP/DKK 9.0322GBP/ZAR 11.655GBP/HUF 345.34EUR/USD 1.2520Euro gains
EU banks borrowed less than expected from the ECB this week, easing funding concerns and helping the Euro to gather strength. The recent surge in Sterling Euro rates seems to have ended, and we've now dropped back away somewhat from the 20 month highs seen earlier in the week.

As fears begin to ease over the debt problems in the EU, the Euro may continue to gain strength which may cause GBP/EUR rates to fall.

Pound gains against US Dollar
The US Dollar has weakened over the last few days, helping to push GBP/USD rates to an 8 week high. Rates have risen from the $1.30's earlier in the year to back above the $1.…