With minutes from the Bank of England’s latest policy meeting scheduled for publication this morning the Pound softened against peers including the Euro and US Dollar as the local session began. Sterling was trading in the region of a four-month low against the Euro on speculation that the minutes will show that the central bank’s interest rate policy decisions in the months ahead will be dependent on economic developments. UK employment data could also be a catalyst for Pound movement.
GBP/EUR is trading in the region of 1.1493 and GBP/USD is trading in the region of 1.5089
Hopes that today’s US housing starts figures will show a second monthly gain, and thereby add to the case for reining in quantitative easing, supported the US Dollar overnight. The safe-haven currency advanced on the Yen, Pound and Euro prior to Fed Chairman Ben Bernanke’s speech to congress.
USD/GBP is trading in the region of 0.6627 and USD/EUR is trading in the region of 0.7615
Although the Euro pushed above 1.31 against the US Dollar and 87.0 against the Pound overnight, the common currency weakened slightly against its American counterpart this morning. While today’s Eurozone construction output data will be of interest, Euro fluctuations are most likely to be triggered by developments in Greece and the US.
EUR/GBP is trading in the region of 0.8701 and EUR/USD is trading in the region of 1.3132
Speculation that disappointing domestic economic growth, coupled with a slowdown in China, could push the Reserve Bank of Australia into cutting rates saw the ‘Aussie’ shed recent gains and weaken against several of its main rivals. The commodity-driven currency was also adversely affected by a decline in the Australian Westpac Leading Index, which fell from a revised 0.7 per cent in April to 0.2 per cent in May.
AUD/GBP is trading in the region of 0.6097, AUD/EUR is trading in the region of 0.7007 and AUD/USD is trading in the region of 0.9197
New Zealand Dollar
As Chinese stocks fell for the first time in several days the higher-risk ‘Kiwi’ fell out of favour. The New Zealand Dollar dropped to 78.48 against the US Dollar and is likely to remain under pressure prior to Fed Chairman Ben Bernanke’s address.
NZD/GBP is trading in the region of 0.5203, NZD/EUR is trading in the region of 0.6001 and NZD/USD is trading in the region of 0.7840
After dipping slightly against the US Dollar the ‘Loonie’ was able to close the local session little changed after recouping losses as a result of ongoing speculation regarding US easing. While US news will be a key concern, Canadian Dollar fluctuations are also likely to result from today’s Bank of Canada rate decision.
CAD/GBP is trading in the region of 0.6375, CAD/EUR is trading in the region of 0.7326 and CAD/USD is trading in the region of 0.9617
These exchange rates were correct as of 9:10 am