‘Aussie’ posted widespread declines

Pound Sterling

A resurgence of fears regarding the US fiscal cliff and a 18-month high in UK consumer confidence allowed Sterling to rebound from yesterday’s declines and hit a one-week high against the US Dollar. Industry experts have cited an Asian Central Bank as a significant source of demand for the currency. Today fluctuations in the Pound are most likely to result from a batch of significant Eurozone data, including the Eurozone unemployment rate for October, and developments in the US.

The Pound is presently trading against the Euro in the region of 1.2333 and is trading against the US Dollar in the region of 1.6045

US Dollar

The ‘Greenback’ fell against several of its peers yesterday as US data releases exceeded forecasts and US Congressional leaders appeared confident that they would reach an accord which would allow them to sidestep next year’s fiscal cliff. The improved global economic outlook which resulted turned investors away from the safe-haven Dollar. However, after another day of budget negotiations US House Speaker John Boehner commented that no significant progress had been made and optimism faltered. Today sees the release of several key pieces of economic data for the Eurozone. If any of them should fail to meet expectations risk aversion could dominate the market, causing the ‘Greenback’ to climb.

The US Dollar is presently trading against the Pound in the region of 0.6233 and is trading against the Euro in the region of 0.7688

Euro

A stream of positive economic releases for the US brightened the global economic outlook yesterday and triggered a bout of risk-taking in the market place. As a higher-risk currency the Euro was able to benefit, recording gains against its safe-haven counterparts the US Dollar and Japanese Yen. Today significant movement could follow the release of several key Eurozone economic indicators including Italian CPI figures and Eurozone unemployment/consumer price index statistics.

The Euro is presently trading against the Pound in the region of 0.8108 and is trading against the US Dollar in the region of 1.3010

Australian Dollar

Increasing expectations that the Reserve Bank of Australia will lower interest rates next week caused the ‘Aussie’ to drop against the majority of its most-traded counterparts, falling close to a three-week low against the New Zealand Dollar. The likelihood of a rate cut has increased in recent days and was exacerbated yesterday as a slowdown in mining ignited fears for the Australian economy. A lack of economic news for the South Pacific nation means that movement in the Australian Dollar will be in response to developments elsewhere.

The Australian Dollar is presently trading against the Pound in the region of 0.6499, is trading against the Euro in the region of 0.8011 and is trading against the US Dollar in the region of 1.0424

New Zealand Dollar

A report which showed a less impressive projection for mining investment than expected triggered losses in the Australian Dollar and allowed the ‘Kiwi’ to climb close to a three-week high against its neighbouring currency. However, the New Zealand Dollar was unable to advance against its other rivals with gains limited by New Zealand data showing a drop in building permits.

The New Zealand Dollar is presently trading against the Pound in the region of 0.5127, is trading against the Euro in the region of 0.6323 and is trading against the US Dollar in the region of 0.8233

Canadian Dollar

The Canadian Dollar proved unable to maintain yesterday’s rally and posted losses against the majority of its peers after the nation’s current account deficit extended to the second-largest ever recorded. The ‘Loonie’ was held lower by a lack of ‘substantive progress’ in the US budget negotiations. With Canadian third quarter GDP figures scheduled for release this afternoon the currency could experience volatility in the hours ahead.

The Canadian Dollar is presently trading against the Pound in the region of 0.6281, is trading against the Euro in the region of 0.7745 and is trading against the US Dollar in the region of 1.0077

 

Richard Martin
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After working in business development for a major UK currency brokers for several years, Richard left Britain to help set up the company’s Australian office and now lives and works in Queensland; making the most of his new Down-Under lifestyle.