Exchange Rates Today: Sterling Holds onto Gains against the Euro

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Pound Sterling

The Pound managed to hold onto gains against the Euro on Monday morning. However, the GBP/EUR pairing it is likely to come under pressure ahead of Thursday’s Scottish Referendum vote. Sterling received some support on Monday morning from the release of a report by the Federation of Small Businesses (FSB). In its quarterly survey three-fifths of firms said that they expect that they will experience growth over the coming year. Global bodies from the International Monetary Fund to the OECD have said that the UK is likely to remain the fastest growing developed economy for the foreseeable future.

US Dollar

The US Dollar remains supported against its major peers as a result of expectations that the Federal Reserve is edging closer to raising interest rates. Investors will be watching Wednesday’s Fed policy meeting closely for signs that the central bank will cut its monthly bond-buying programme by another $10 billion. If it does then the programme will be on target to end in October.

Euro

The Euro remains under heavy pressure against all of its rivals as concerns over the strength of the Eurozone economy continue to weigh upon sentiment. News that an anti-Euro party won two eastern state parliaments in Germany caused concerns that support for the single currency is waning in the Eurozone’s largest economy.

Australian Dollar

The ‘Aussie’ tumbled to a fresh six-month low against the US Dollar due to the publication of disappointing motor vehicle sales data. Official data earlier showed that Australia’s new motor vehicle sales declined by 1.8% last month after a 1.3% drop in July. Additional declines occurred because of a separate report showing that Chinese factory output and retail sale growth slowed last month.

New Zealand Dollar

The New Zealand Dollar fell to a new seven-month low against the US Dollar and softened further against the Pound and other peers. The currency remains under pressure from expectations that the US Federal Reserve will raise interest rates sooner than expected. Data out of China and falling commodity prices are also weighing upon the currency.

Canadian Dollar

The ‘Loonie’ continues to soften as falling oil prices, concerns over the escalating conflict in Iraq and expectations of a US interest rate hike put pressure on the commodity-driven asset. The weaker than expected data out of China also had an adverse impact.

South African Rand

The Rand continued its downward slide against most of its currency counterparts and is forecast to remain under pressure until the publication of domestic inflation data and the South African Reserve Bank’s interest rate decision, due later in the week.

Disclaimer: This update is provided by TorFX, a leading foreign exchange broker, its content is authorised for reuse by affiliates.

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