‘Loonie’ dropped to four month low

Pound Sterling

Although UK retail sales for September exceeded analyst’s expectations, making the outlook for the nation’s economic recovery more optimistic, the Pound maintained its bearish trend against the US Dollar after a brief rebound. Sterling did manage to break from its two-day run of declines against the broadly strengthening Euro, gaining a modest 0.1 per cent towards the close of trade yesterday. Over the past quarter the Pound has weakened by 0.9 per cent and some industry experts are predicting that it could weaken to as low as 1.52 US Dollars by the close of 2013.

The Pound is presently trading against the Euro in the region of 1.2285 and is trading against the US Dollar in the region of 1.6051

US Dollar

The US Dollar briefly fell against the Pound following better-than-forecast retail sales figures for the UK and worse-than-expected US Jobless Data. As trade wore on however the ‘Greenback’ managed to recoup the majority of its losses. In the main the US Dollar held steady against the Euro. A key indicator of US economic health is due for release this afternoon in the form of US Existing Home Sales. If the result exceeds expectations the ‘Greenback’ could be bolstered as trade continues.

The US Dollar is presently trading against the Pound in the region of 0.6231 and is trading against the Euro in the region of 0.7655

Euro

Despite the Euro ending two days of gains against the ‘Greenback’ by falling 0.2 per cent some industry experts have forecast that the currency could extend its present rally and achieve as high as 1.35 US Dollars by the end of the year – a level not seen for 11 months. Such a bullish trend could occur as the common currency has traded above its 200-day average over the past month. This hints at the possibility of the Euro forming a ‘golden cross’ – where the 50-day moving average exceeds the 200-day average. As the EU leaders summit enters its second day in Brussels investors will be watching any developments keenly.

The Euro is presently trading against the Pound in the region of 0.8140 and is trading against the US Dollar in the region of 1.3060

Australian Dollar

In recent days positive data from China and the US has gone a long way to improving the outlook for the global economy. As demand for higher-risk assets improves so do the fortunes of the ‘Aussie’, and the Australian Dollar is in line for its largest weekly gain for over a month. The currency received an additional boost after Pacific Investment Management Co stated that it had bolstered holdings in Australia and New Zealand’s assets. The release of US Existing Home Sales figures will be the main cause of volatility in the ‘Aussie’ today.

The Australian Dollar is presently trading against the Pound in the region of 0.6453, is trading against the Euro in the region of 0.7928 and is trading against the US Dollar in the region of 1.0362

New Zealand Dollar

The New Zealand Dollar is heading for its steepest decline against its neighbouring currency for five months after government figures showed that the nation’s consumer prices in the third quarter increased at their most languid pace for 13 years. Meanwhile separate data boosted Australia’s outlook after showing better-than-forecast job growth. Losses in the ‘Kiwi’ were tempered however by heighted risk appetite and the currency was able to advance on the British Pound while remaining relatively unchanged against the safe-haven Japanese Yen.

The New Zealand Dollar is presently trading against the Pound in the region of 0.5106, is trading against the Euro in the region of 0.6270 and is trading against the US Dollar in the region of 0.8185

Canadian Dollar

After yesterday’s impressive rally the ‘Loonie’ dropped to a four-month low against the US dollar following an announcement made by the Canadian Finance Minister. Jim Flaherty reiterated remarks made by Bank of Canada Governor Mark Carney made earlier in the week, commenting that the country may well have to negatively revise its economic outlook. As well as posting significant declines against its American counterpart the Canadian Dollar recorded losses against many of its other peers.

The Canadian Dollar is presently trading against the Pound in the region of 0.6317, is trading against the Euro in the region of 0.7758 and is trading against the US Dollar in the region of 1.0140

 

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.