Showing posts from January, 2012

Greek debt worries weaken Euro. Again.

Tuesday 31st January 2012
Good morning. There were no UK data releases of note yesterday, so yet again exchange rates were driven by events in the Eurozone. Sterling gained against a broadly weaker euro ahead of an EU summit in Brussels, with investors cautious as talks continued between Greece and private creditors on a debt swap deal. This pushed GBP/EUR rates higher, but not by much and rates remain under €1.20. Against the US Dollar, the Pound fell slightly as the weaker Euro drove investment to the safe haven US Dollar.

~Currency Movements on Monday 30th January 2012~

Pound gains vs Weaker Euro

European Union leaders yesterday had a meeting to discuss a deal introducing a permanent bailout fund for the euro zone, the European Stability Mechanism (ESM), and finalise a fiscal compact that will introduce a balanced budget rule in national legislation.

However, this was overshadowed by negotiations on a debt swap deal in Greece, which has weakened the Euro slightly and pushed GBP/EUR rate…

Weekly GBP/EUR & GBP/USD and the weeks data

Monday 30th January 2012
Good morning. Another Monday, so let's start the week with a full breakdown of the last weeks movements in the currency markets.

In this week’s Report:

• Pound/Euro hits 4 week low
• Sterling/Dollar rises to 5 week high
• UK headed back to recession, more QE on the way
• Round up of the week’s data that may affect rates

(For currencies other than GBP, EUR and USD, contact us for a consultation)

Sterling vs. Euro;

Last week saw the volatility continue in the currency markets as Sterling dropped to a 4 week low against the Euro. With the UK economy shrinking by 0.2% in the last quarter of 2011 and poor UK retail data being released, Sterling fell away from the €1.20 highs we have seen over the last few weeks. One of the only positives for the UK was the news from the BoE (Bank of England) that all 9 members had voted against more QE which lent some valuable to support to the pound. There were also some positive sounds coming from Greece as leaders met Private Credit…

Sterling falls again on Poor UK data/Optimism on Greece

Friday 27th January 2012
Good morning. Sterling dropped yesterday to a 4 week low against the Euro on poor UK Retail Data, and hopes of progress in Greek debt talks bolstering the single currency. Against the US Dollar however, Sterling hit a 5 week high after a host of Economic data including Unemployment was much worse than expected, weakening the USD and making it cheaper to purchase. It's these points I'll cover today after the usual snapshot of yesterdays movements:

~Currency Movements on Thursday 26th January~

UK Data disappoints, weakening the Pound

Yesterdays UK data was the CBI Distributive Trades Survey, which is released by the Confederation of British Industry. It's an indicator of short-term trends in the UK retail and wholesale distribution sector, and can have an impact on the formulation of economic policy at the Bank of England and within Government.

The forecast was for a 12% gain, however the actual figure was a 22% decline. The poor result reversed the gains…

UK GDP poor, QE in Feb, Pound rises - why?

Thursday 26th January 2012
Good morning. Yesterday GDP figures showed the economy contracted by 0.2% in the last quarter, and in the run up to the release Sterling fell across the board. The minutes to the BoE meeting to discuss QE however revealed all 9 members voted not to increase it, and this then lent some support to the Pound. Concerns about the European Central Bank having to write down its Greek bond holdings as part of a deal to avoid a disorderly default also weighed on the single currency, pushing GBP/EUR rates up.

Today we will look at the GDP and BoE release, analyse why it pushed the Pound up, and take a look at how QE in February may affect Sterling exchange rates. Below you can see the drop in the run up to the data release at 09:30am, and then the recovery after the BoE Minutes:

~Currency Movements on Tuesday 24th January~

UK GDP shows we're headed to recession

UK economic activity shrank by 0.2% in the last three months of last year according to official figures relea…

UK GDP and BoE minutes effect on Sterling

Wednesday 25th January 2011
Good morning. The Pound briefly hit a 4 week low vs the Euro yesterday, before recovering to around €1.20. Sterling also rose against the US Dollar, despite many in the markets predicting today could well generate weakness for the Pound. At 09:30 am today we will see the latest GDP figures, and the minutes to the most recent Bank of England (BoE) minutes - both of which could cause significant volatility for Sterling. We'll focus on this today, after the usual snapshot of yesterdays movements:

~Currency Movements on Tuesday 24th January~

BoE Minutes and GDP - Important day for the Pound

Today at 09:30 we will see 2 important UK data releases that will have an impact on the future of Sterling. GDP figures are released which will show if the economy is growing or not, and at what pace. It's a measure of the total value of all goods and services produced by the UK, and is considered as a broad measure of the UK economic activity.

We predict that the monthly…

Pound falls against Euro, rises against US Dollar

Tuesday 24th January 2012
Good morning. Yesterday Sterling fell against the Euro by around 0.7%, pushing rates down to the mid 1.19's. Against the US Dollar, the Pound rose by around 0.5%, as the Dollar weakened on predictions it's interest rates will stay at record lows for some time to come. The below chart illustrates how exchange rates fared throughout trading yesterday:

~Currency Movements on Monday 23rd January~

Pound rises vs US Dollar

As you can see, rates steadily rose to buy the Dollar yesterday, although many investors were cautious about pushing the pound up further on growing concerns the Bank of England will have to inject further cash into the fragile UK economy. Expectations that the U.S. Federal Reserve will keep interest rates low for some years to come helped to weaken the US Dollar and made it cheaper to purchase.

Sterling falls against Euro

The Pound did not fare as well against the single currency. The Eurozone crisis has not escalated any further since last we…

Weekly GBP/EUR & GBP/USD and the weeks data

Monday 23rd January 2012
Good morning. As always for a Monday, today I will take a retrospective look at last weeks movements in the currency markets, and what this week may hold for the Pound Sterling Forecast against the Euro & US Dollar. Also included is a list of the most important data to watch our for that might affect rates this week.

In this week’s Report:

• Pound/Euro remains range bound at €1.20

• Sterling recovers against weaker US Dollar

• BoE Minutes could signal further QE in February

• Round up of the week’s data that may affect rates

(For currencies other than GBP, EUR and USD, contact us for a consultation)

Sterling vs. Euro;

The start of the last week saw GBP/EUR rates trading around the 1.20 (Interbank) level as all eyes were still on the Euro zone. High UK unemployment figures and the hint of more Quantitative Easing could see a very volatile week ahead of us.

Tuesday’s key data showed a rise in unemployment within the UK and indicated that it had increased steadily thr…

Getting the best exchange rates for your currency

Friday 20th January 2012
Good morning. The Pound pushed a little higher against the Euro and US Dollar yesterday, tracking gains in the euro versus the dollar after solid demand at a Spanish debt auction, but its rise was limited by weak consumer confidence data that added to concerns about the UK economy. Below shows how GBP/EUR and GBP/USD moved yesterday:

~Currency Movements on Wednesday 18th January~

Good Demand at Spanish Bond Auction

At a bond auction yesterday, Spain sold 6.61 billion euros of government bonds which was more than its announced target, in an auction that analysts said went well. This caused the Pound to rise also due to it's links to the Eurozone, so despite some slight gains as shown by the chart, rates remain stuck around the €1.19 to €1.20 level. Analysts have said that the Euro's gains were likely to be limited as investors remain wary of any development that may cause the euro debt crisis to worsen significantly, with market players keeping a close watc…

Mixed day for Sterling as Unemployment/IMF drive markets

Thursday 19th January 2012
Good morning. It was a mixed day in the currency markets yesterday. Initially poor UK unemployment pushed Sterling lower against the Euro. However, as reports suggested the International Monetary Fund was proposing to boost its lending resources, this supported the euro and riskier currencies, pushing the Pound up later in the day. Below shows how GBP/EUR and GBP/USD moved yesterday:

~Currency Movements on Wednesday 18th January~

UK Unemployment figures disappoint

Figures released yesterday show that UK unemployment rose by 118,000 in the three months to November to 2.685 million. The Office for National Statistics (ONS) said the unemployment rate also rose to 8.4% from 8.3%, the highest since January 1996.

The numbers were slightly lower than analysts had forecast, and support the picture of a flat UK economy, with other data released on Wednesday showing average weekly earnings, including bonuses, grew at just 1.9%.

This pushed Sterling lower against other curre…

Increased chance of QE pushes Sterling lower

Wednesday 18th January 2012
Good morning. Yesterday UK inflation figures increased the chance of further Quantitative Easing next month, pushing Sterling lower against other currencies. The Euro also strengthened a little earlier in the day after better than expected German data, however ongoing concern about sovereign debt limited the drop, with rates for Euros ending up where they started the day! Today we have various unemployment measure for the UK, which will likely have the biggest impact on rates. Below shows how GBP/EUR and GBP/USD moved yesterday:

~Currency Movements on Tuesday 17th January~

UK Inflation data increases chance of Quantitative Easing

Data released yesterday showed that UK inflation fell sharply in December, with the annual CPI rate dropping to 4.2 percent from 4.8 percent in November, supporting the Bank of England's view that consumer price inflation may have peaked. This lower than expected reading is likely to increase the chances that the Bank of England wi…

Pound remains supported against Euro

Tuesday 17th January 2012
Good morning. It was a very flat day on the markets yesterday, despite the downgrade of EU countries over the weekend by S&P. Pound Euro remained range bound just below a 16 month high, and Sterling Dollar remained around an 18 month low. This is all due to the EU debt crisis, with the downgrade keeping the Euro weak and the Dollar strong. The charts below show how rates moved throughout the day yesterday :-

~Currency Movements on Monday 16th January~

Eurozone credit rating downgrades

As you can see, there was little movement at all, and through the whole day the cost of €100k only varied by around £150. Very very quiet indeed compared to what we have been used to of late, however there is much happening this week that could change things.

Ratings agency Standard & Poor's last week downgraded the credit rating of nine euro zone countries including France and Austria after the close of London markets, however the rumours had been circulating all day…

Weekly GBP/EUR & GBP/USD and the weeks data

Monday 16th January 2011
Good morning. As always on a Monday morning, today I will give a detailed summary of last weeks movements and the Pound Sterling forecast for Euro and US Dollar, in addition to the weeks data that might affect exchange rates.

In this week’s Report:

• GBP/EUR hits 16 month high before falling back
• BoE and ECB keep interest rates on hold, more UK QE expected in February
• US Dollar remains safe haven due to EU troubles
• Round up of the week’s data that may affect rates

(For currencies other than GBP, EUR and USD, contact us for a consultation)

Sterling vs. Euro;

We began last week with Sterling trading close to a 16-month high against the euro as focus remained on the debt and liquidity problems continuing to plague the single currency.

The outlook for the single currency was clouded ahead of Spanish and Italian debt auctions later in the week which were seen as a key test of sentiment. The auctions would gauge investor willingness to invest in the troubled euro zone …

Pound falls against Euro after Interest Rate decisions

Friday 13th January 2012
Good morning. Friday the 13th. Unlucky for some, and certainly unlucky for those that did not take advantage of the 16 month high in rates this week, as levels have now dropped back away. In yesterdays post I pointed out that in 3 years, the GBP/EUR rate had gone through €1.20 several times, only to quickly correct downwards, and that a repeat could be on the cards. Indeed, after the Interest Rate decisions yesterday, the Pound fell after positive comments from the ECB president strengthened the Euro. We'll take a detailed look at what happened after the usual snapshot of where rates moved throughout trading yesterday:

~Currency Movements on Thursday 12th January~

Bank of England leave Interest Rates and QE on hold

UK interest rates have been held at their record low of 0.5% by the Bank of England's Monetary Policy Committee. Interest rates have now been at their record low since March 2009. The Bank did not announce any increase in its policy of quanti…

BoE and ECB Interest Rate Decisions today

Thursday 12th January 2011
Good morning. Today we'll look at the Pound Sterling forecast against other major currencies such as the Euro and USD. The Pound fell to a near 1 year low against the US Dollar yesterday. Against the Euro the Pound also ended the day down.

Trade balance figures were worse than expected, but the main reason was repositioning ahead of today's announcements by the Bank of England and European Central Bank. The below charts shows how rates moved throughout the day yesterday:

~Currency Movements on Wednesday 11th January~

Bank of England (BoE) announcement today

Today is a very important day for the Pound. At 09:30am we will see the latest manufacturing and industrial production figures. This is followed by an announcement at 12:00pm by the BoE on interest rates and Quantitative Easing (QE).

Most in the market expect rates to be left on hold, and no further QE stimulus. There is a small chance further money will be pumped into the ailing economy however, and…

Pound/Euro forecast outlook for 2012 Q1

Wednesday 11th January 2011
Good morning. Another calmer day, with the market finishing up pretty much where we started at the beginning of the trading day. Initially sterling slipped against the Euro, falling below the €1.21 level as investors trimmed bets to sell the single currency across the board, but the pound hovered near a 16-month high hit the previous day as sentiment towards the euro remained negative. Below you can see how rates for GBP/EUR and GBP/USD moved through the day yesterday:

~Currency Movements on Monday 9th January~

Pound remains near 16 month high vs Euro

As the charts above show, the GBP/EUR rate slipped throughout the day before recovering later. This was reported to be due to Euro demand from a UK clearer ahead of one of the Bank of England's afternoon fixings had pushed the single currency to the day's high. Demand strengthens a currency, and makes it more expensive, resulting in the drop.

Later in the day however, the Euro weakened again, pushing rates…

Sterling remains range bound vs Euro

Tuesday 10th January 2012
Good morning. It was a much calmer day on the markets yesterday, after the volatility we saw last week. Sterling/Euro fell a small amount, but stayed around the 16 month high seen last week. The cross was range bound between just below €1.21 and €1.2130. The GBP/USD rate was also fairly stable yesterday. The charts below show rate movements:

~Currency Movements on Monday 9th January~

Sterling remains Range-bound vs Euro

There was no key data of note released for the UK yesterday, and as such there was little movement in the Sterling/Euro rate yesterday, but buying levels remain around the 16 month high, ahead of Spanish and Italian debt auctions later in the week.

These auctions are going to be seen as a key test of sentiment towards the beleaguered Eurozone. They will gauge investor willingness to invest in troubled euro zone sovereigns after newspaper reports over the weekend added to concerns the crisis is intensifying.

Also to look out for this week will be the…

Weekly GBP/EUR & GBP/USD and the weeks data

Monday 9th January 2011
Good morning. Pound/Euro rates have surged to a 16 month high, so today as usual for a Monday morning, I will take a look at movements in the last week for Euro, US Dollar, forecasts for where exchange rates may go in 2012, and the weeks economic data that could affect exchange rates.

In this week’s Report:

• Sterling/Euro hits 16 month high above €1.21
• EU problems continue, weakening Euro
• GBP/USD rates fall as US jobs data surprises
• Round up of the week’s data that may affect rates

(For currencies other than GBP, EUR and USD, contact us for a consultation)

Sterling vs. Euro;

Last week the Pound benefited against the Euro as the single currency slumped to its lowest level in 16 months, driven by fears that the Eurozone countries and their banks may be crumpling under the mounting pressure of their debts.

Shares in two Italian banks, including Unicredit, were suspended after sustaining heavy losses. Spanish banks also suffered last week after the Spanish finance min…

Pound at 16 month high vs Euro above €1.21

Friday 6th January 2011
Good morning. Sterling has surged against the Euro, and risen to its highest in nearly 16 months. This was due to a weak Euro, over worries about EU sovereign funding pressures and after data showed a pick-up in UK service sector activity. At 08:30am this morning rates are as follows:

• GBP/EUR 1.2123
• GBP/USD 1.5609
• GBP/AUD 1.5127
• GBP/CHF 1.4770
• GBP/CAD 1.5796
• GBP/ZAR 12.642
• GBP/JPY 119.69
• GBP/DKK 9.0151
• GBP/NOK 9.3128

Pound at 16 month high vs the Euro

Sterling rose against the weak Euro yesterday, breaking through the €1.21 level and creating the best buying opportunities for 16 months. The euro was down broadly and not just against the Pound. It hit lows versus the dollar and a decade low versus the yen as major concerns about euro zone countries' ability to raise funds in coming months pushed investors away from the common currency.

France's first bond auction of the year also happened, where investors mindful of the threat to t…