Pound dropped against Euro

Pound Sterling

With anticipation surrounding further UK monetary stimulus increasing the British Pound declined against its European cousin. Prior to the close of the Bank of England’s two day meeting Sterling dropped to a two week low against the Euro. Although the BoE is expected to leave its quantitative easing programmed unaltered and retain present interest rates economists and industry experts have predicted that the UK’s faltering economy will force the central bank into easing policy earlier.

The Pound is presently trading against the Euro in the region of 1.2451 and is trading against the US Dollar in the region of 1.6125

US Dollar

The US Dollar enjoyed an upsurge following the release of ADP Non-Farm Employment Change data. This figure is viewed as an accurate forecast of the Non-Farm Payrolls figure (due for release on Friday) and after the disappointing data seen lately this better than expected result bolstered investor confidence in US economic recovery. The ‘Greenback’ made particularly significant advances against its Canadian competitor and the Japanese Yen.

The US Dollar is presently trading against the Pound in the region of 0.6204 and is trading against the Euro in the region of 0.7722

Euro

Despite the recent raft of less-than-impressive Eurozone data and the turmoil afflicting the currency bloc the Euro managed to recover from yesterday’s three-week-low against the US Dollar and made gains against other major currencies. The common currency was aided by increased risk appetite inspired by positive US data but with a Spanish bailout still unresolved and a pessimistic outlook expected from the ECB Press Conference (scheduled for later today) negative fluctuations in the Euro seem likely.

The Euro is presently trading against the Pound in the region of 0.8024 and is trading against the US Dollar in the region of 1.2940

Australian Dollar

The recent string of relatively weak Australian data was added to yesterday as retail sales were revealed to have grown more slowly in August than predicted. Although the figure compares favourably with July’s decline of 0.8, economists forecast a 0.4 per cent increase and the actual number was half that at 0.2. This data, combined with that which showed the South Pacific nation’s trade deficit widened to the most for four years, left the Australian Dollar weakening against the majority of its peers. Expectations that the Reserve Bank of Australia will attempt to bolster growth by reducing borrowing costs for a second consecutive month also pushed the ‘Aussie’ towards the lowest level seen for almost a month.

The Australian Dollar is presently trading against the Pound in the region of 0.6346, is trading against the Euro in the region of 0.7904 and is trading against the US Dollar in the region of 1.0228

New Zealand Dollar

Following an announcement made by Federal Reserve chairman Ben Bernanke – in which he disclosed that the central bank planned to enlarge its holdings of long-term securities – demand for riskier assets declined. This was reflected in the fortunes of the New Zealand Dollar which fell against its American counterpart. The ‘Kiwi’ also dropped against the British Pound but remained relatively unchanged against the Euro and managed to advance against the ‘Aussie’. With no significant New Zealand data in the offing today any movement will likely be a result of developments in the US, Europe and Asia.

The New Zealand Dollar is presently trading against the Pound in the region of 0.5094, is trading against the Euro in the region of 0.6343 and is trading against the US Dollar in the region of 0.8219

Canadian Dollar

Better-than-predicted US data combined with a report which showed a droop in non-manufacturing industrial growth in China, caused the Canadian Dollar to decline to an almost four-week low. With economists predicting data to show a reduction in Canadian employment for September the ‘Loonie’ is expected to experience more volatility.

The Canadian Dollar is presently trading against the Pound in the region of 0.6294, is trading against the Euro in the region of 0.7833 and is trading against the US Dollar in the region of 1.0143

 

Richard Martin
This post was written by
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.