Euro continues to fall

Pound Sterling

As trade came to a close on Friday the Pound continued to gain on its common currency rival. After the German central bank downgraded the nation’s growth outlook (thereby decreasing confidence in the Eurozone as a whole) the Euro broadly softened, allowing the Pound to hit a two week high. Sterling did drop against the US Dollar however after better than expected US employment data. This week the Pound is vulnerable to further signs of weakness in the UK economy. The majority of significant UK data on the cards for this week, including jobless claims change and employment change is scheduled for release on Wednesday.

The Pound is presently trading against the Euro in the region of 1.2429 and is trading against the US Dollar in the region of 1.6036

US Dollar

The US Dollar advanced on the majority of its peers on Friday after disappointing developments in the Eurozone turned investors away from risk and toward safe-haven assets. The American currency was also able to benefit from better-than-forecast employment data. However, as concerns regarding the US fiscal cliff situation resurfaced the ‘Greenback’ turned bearish. A lack of US data over the next couple of days means that investors will be focusing on the fiscal cliff negotiations and looking ahead to Wednesdays Federal rate decision.

The US Dollar is presently trading against the Pound in the region of 0.6237 and is trading against the Euro in the region of 0.7751

Euro

Last week the Euro fell to a seven-week low against the US Dollar and a two week low against the British Pound after negative data releases and slashed growth outlooks damaged confidence in the Eurozone’s economic recovery. Now the Italian Prime Minister has announced his intention to resign, plunging another member of the 17 nation currency bloc into uncertainty and causing the Euro to fall. Of particular interest this week is the gathering of European Union leaders which will take place on Thursday and Friday. During the meeting the European leaders will discuss guidelines for an overhaul of the Eurozone. Also of note is Tuesdays German ZEW economic sentiment survey.

The Euro is presently trading against the Pound in the region of 0.8045 and is trading against the US Dollar in the region of 1.2901

Australian Dollar

Last week the Australian Dollar enjoyed a bullish relationship with its peers but disappointing Chinese import and export data pushed the ‘Aussie’ lower against its competitors and down from its highest level against its US counterpart for over eight weeks. Fluctuations in the Australian Dollar could be caused early in the week by Tuesday’s Westpac Consumer Confidence Index as well as by developments in Asia and the US.

The Australian Dollar is presently trading against the Pound in the region of 0.6532, is trading against the Euro in the region of 0.8116 and is trading against the US Dollar in the region of 1.0475

New Zealand Dollar

Although slowing Chinese export figures lessened confidence in the recovery of the world’s second largest economy the ‘Kiwi’ was bolstered by developments at home. Increasing dairy prices pushed the New Zealand Dollar higher against a number of of its most traded rivals. Several pieces of potentially volatile New Zealand data are scheduled for release over the course of the week including card retail spending and house sales.

The New Zealand Dollar is presently trading against the Pound in the region of 0.5199, is trading against the Euro in the region of 0.6458 and is trading against the US Dollar in the region of 0.8325

Canadian Dollar

The ‘Loonie’ was able to achieve its highest level for four weeks against its US counterpart after Canadian employment data was significantly better than expected. Employers added nearly six times the amount of jobs predicted by economists, brightening Canada’s economic outlook. In the hours ahead movement in the Canadian Dollar could be caused by today’s housing starts figures for the nation.

The Canadian Dollar is presently trading against the Pound in the region of 0.6313, is trading against the Euro in the region of 0.7842 and is trading against the US Dollar in the region of 1.0122

 

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.