The Pound was holding onto Thursday’s gains after another opinion poll showed the Pro-UK No campaign in the lead ahead of next week’s Scottish Referendum. Comments made by Royal Bank of Scotland indicating that it would move operations into England in the event of a Yes vote were also deemed as a positive as traders believed that people would be swayed to vote in favour of staying a part of the UK. Market concerns over a possible breakup of the 300-year old union eased as a result.
The US Dollar is on course to make its biggest weekly gain in 10 months against most of its major peers as economists increased their bets that the session’s Retail Sales data will add to the case for the Federal Reserve raising interest rates. Expectations that the Fed will choose to end its monthly bond-buying programme in October have seen the ‘Greenback’ surge against the majority of its peers.
The Euro was little moved against its rivals as the markets awaited the release of the latest Industrial Production data out of the Eurozone. Economists are widely forecasting that production increased in July. If that proves to be the case then the single currency could regain some ground. The currency remains under pressure from last week’s surprise decision by the European Central Bank to cut interest rates to a new record low.
The ‘Aussie’ extended its losses against the Pound and other peers as traders continued to selloff the currency. Thursday’s strong jobs data was widely ignored, as many economists were unsure that the data was in fact reliable. Against the US Dollar, the ‘Aussie’ fell below the 91 cents level.
New Zealand Dollar
The New Zealand Dollar dropped to a fresh seven-month low against the US Dollar on Friday and weakened further against other peers as the currency remains under pressure from comments made by the Governor of the Reserve Bank of New Zealand.
The ‘Loonie’ added to its run of losses as weaker than forecast inflation data out of China and falling oil prices weighed heavily. The currency is likely to extend declines as economists call for an even lower Canadian currency. Observers expect the ‘Loonie’ to slide further over the next several months.
South African Rand
The Rand fell to a fresh seven-month low against the US Dollar and other peers as geopolitical concerns and a stronger Dollar reduced demand for emerging market assets. Fresh sanctions being imposed against Russia by the European Union and a widening of the conflict against the Islamic State are weighing on risk sentiment.
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