Sterling recouped losses

Pound Sterling

After hitting a four-month low against the Euro last week Sterling was able to recoup some of its losses on the back of better-than-forecast UK public borrowing figures. The Pound was also able to hold steady against the US Dollar. Gains in the British currency were tempered by continuing concerns regarding the Bank of England implementing further quantitative easing. With little key UK data scheduled for release at the beginning of the week investors will be waiting for Thursday’s prelim third-quarter GDP which is expected to show modest economic recovery.
The Pound is presently trading against the Euro in the region of 1.2280 and is trading against the US Dollar in the region of 1.6030

US Dollar

Belief that the US economy is strengthening was heightened following Friday’s positive US New Home Sales figures which led to the Greenback posting significant gains against some of its currency rivals, including the New Zealand Dollar. Data releases on Wednesday and Thursday (including weekly US jobless claims the FOMC Interest Rate Announcement and New Homes Sales figures) will be the most prominent causes of US Dollar volatility this week.

The US Dollar is presently trading against the Pound in the region of 0.6238 and is trading against the Euro in the region of 0.7660

Euro

Despite enjoying some significant advances recently, the next two months will be essential to restoring long-term confidence in the Euro. European leaders are entering a serious period of negotiation when it comes to the future governance of the currency bloc, particularly the allocation of money and power. Although French President Francois Hollande recently declared that when it came to saving the common currency they were ‘on track’ with ‘the worst’ behind them, most industry experts foresee months of continuing uncertainty ahead – particularly when it comes to troubled nations Spain and Greece. In the first half of this week investors will be looking out for the result of Tuesday’s Eurozone Flash Consumer Confidence and Wednesday’s Flash Markit PMI.

The Euro is presently trading against the Pound in the region of 0.8135 and is trading against the US Dollar in the region of 1.3042

Australian Dollar

Expectation is mounting that a report will soon show Australian inflation holding close to its slowest for 13 years. This, in conjunction with the nation’s government announcing that it will cut spending to ensure it delivers its budget surplus for this fiscal year, saw the ‘Aussie’ tumbling against the majority of its currency counterparts. This week fluctuation in the South Pacific currency will probably result from Asian data, including China’s Flash HSBC Manufacturing PMI due for release on Wednesday.
The Australian Dollar is presently trading against the Pound in the region of 0.6434, is trading against the Euro in the region of 0.7905 and is trading against the US Dollar in the region of 1.0318

New Zealand Dollar

With risk appetite tempered by a lack of developments in the Eurozone the ‘Kiwi’ recorded modest declines against several of its currency rivals. On Wednesday the Reserve Bank of New Zealand will make its rates announcement which could result in significant movement for the currency.
The New Zealand Dollar is presently trading against the Pound in the region of 0.5096, is trading against the Euro in the region of 0.6266 and is trading against the US Dollar in the region of 0.8166

Canadian Dollar

After a worse-than-expected advance in Canadian consumer prices made it increasingly likely that the nation’s central bank will focus less on increasing policy rates the ‘Loonie’ experienced it’s most dramatic drop against the US Dollar since May. With nothing concrete coming out of last week’s EU leaders summit risk aversion intensified, which helped push the Canadian Dollar 1.4 per cent lower against its American counterpart. Volatility is expected tomorrow following the Bank of Canada’s rates announcement.

The Canadian Dollar is presently trading against the Pound in the region of 0.6275, is trading against the Euro in the region of 0.7715 and is trading against the US Dollar in the region of 1.0060

Laura Barrett
This post was written by
Laura moved from the US to the UK several years ago. As a corporate sales executive for a leading foreign exchange company, Laura has expert knowledge of currency movements and market trends and is able to offer specialist guidance regarding making a trade at the most lucrative time and protecting transactions from currency risk.