‘Loonie’ dropped to a three-week low

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Pound Sterling

With economists forecasting that this morning’s data will reveal a reduction in the UK’s budget deficit in December the Pound was able to gain on its American cousin. After seven days of declines Sterling rose 0.1 per cent against the US Dollar. However, the British currency fell for a fifth day against an advancing Euro, hitting 84.36 – the lowest for almost 11 months – before experiencing a slight upward correction. Today movement in the Pound is most likely to occur as a result of data releases from the UK and Eurozone.

The Pound is presently trading against the Euro in the region of 1.1873 and is trading against the US Dollar in the region of 1.5832

US Dollar

The American bank holiday ensured that the US Dollar experienced little movement against its riskier counterparts yesterday, although the ‘Greenback’ did fall by as much as 34 pips against its safe-haven rival the Japanese Yen. Fluctuations in the US Dollar could occur in response to developments in the Eurozone but the main cause of volatility today promises to be the US existing home sales figures, due out this afternoon.

The US Dollar is presently trading against the Pound in the region of 0.6316 and is trading against the Euro in the region of 0.7493

Euro

Yesterday the Euro was able to benefit from positive developments in Brussels. The meeting of Eurozone finance ministers, which concludes today, has so far resulted in the next instalment of Greek aid being given the go-ahead. The decision to commit to Greece improved confidence in the currency bloc, triggering risk taking in the marketplace and allowing the Euro to gain for a fifth day against the British Pound. The main point of interest today is the German ZEW economic sentiment survey, which is expected to reveal a significant increase from last month’s levels.

The Euro is presently trading against the Pound in the region of 0.8421 and is trading against the US Dollar in the region of 1.3339

Australian Dollar

After the Bank of Japan announced that it would be stepping up its monetary easing methods the prospects for global economic growth improved and the ‘Aussie’ enjoyed gains against the US Dollar. The South Pacific currency posted advances of 0.4 per cent against the ‘Greenback’ and also rose briefly against the Japanese Yen. Tomorrow notable fluctuations in the ‘Aussie’ can be expected following the release of the nation’s 4Q CPI figures.

The Australian Dollar is presently trading against the Pound in the region of 0.6668, is trading against the Euro in the region of 0.7917 and is trading against the US Dollar in the region of 1.0559

New Zealand Dollar

Positive developments in Japan boosted both the global economic outlook and the New Zealand Dollar. The ‘Kiwi’ climbed 0.6 per cent against its American counterpart and experienced a short lived gain of 0.1 per cent against the Japanese Yen. Tomorrow’s Business NZ PMI data for December could cause further movement in the New Zealand Dollar.

The New Zealand Dollar is presently trading against the Pound in the region of 0.5318, is trading against the Euro in the region of 0.6301 and is trading against the US Dollar in the region of 0.8407

Canadian Dollar

Over the course of trade yesterday the ‘Loonie’ dropped to a three-week low against its American rival. Concerns around the Bank of Japan’s possible decision regarding monetary easing saw the commodity-driven Canadian currency shed 0.11 of a cent against a largely static US Dollar. Now that the Japanese central bank has announced its intention to expand monetary easing the ‘Loonie’ is likely to experience volatility as soon as the Canadian market opens.

The Canadian Dollar is presently trading against the Pound in the region of 0.6362, is trading against the Euro in the region of 0.7564 and is trading against the US Dollar in the region of 1.0078

 

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.