EURO/GBP – 1.101
US$/GBP – 1.497
CHF/GBP – 1.611
CAN$/GBP - 1.540
AUS$/GBP – 1.648
ZAR/GBP – 11.105
JPY/GBP – 134.62
HKD/GBP – 11.622
Despite gaining against the US dollar and euro over the weekend due to increased risk appetite, sterling slipped throughout Monday as risk appetite waned due to uncertainty over the UK’s political future in the run up to an election. Sterling fell 0.3% against the euro and dropped from an earlier high of $1.5197/ £1 to trade at $1.5070/ £1 as the market closed. Latest polls from the weekend showed a reversal in the Conservatives favour, but there is a likelihood that it will be a closely fought election and the prospect of a hung parliament is still a cause for concern. Last week the Bank of England kept interest rates on hold and did not expand the asset purchasing facility, but there is still a possibility that this will still happen. Until there is a definitive end to the Bank of England’s liquidity programme, sterling is likely to remain low against most currencies with a likelihood it will drop further. Yesterday saw no major data released and today follows suit as a relatively light day on the economic calendar aside from the latest house price survey. With a brief movement higher yesterday morning, this demonstrates why it is important to be registered early – so we can help you take advantage of positive movements. Get in touch now to avoid missing out on similar positive movement.
In the Euro zone, concerns over Greece eased which helped the euro to strengthen against sterling. Investor confidence improved in the region and German industrial production figures moved back into positive territory with a month on month rise of 0.6%. In addition, news was released that Germany and France were looking at launching a European Monetary Fund to prevent further instability being caused by a single member state, such as the situation with Greece. French President Nicolas Sarkozy also pledged French support to Greece. Out today we have very little data aside from data on the French trade balance which is unlikely to cause too much movement. Regardless, get in touch for a price as there is always scope for considerable volatility.
In the USA, the US dollar dropped against most currencies falling 0.3% against the euro and 0.4% against the Swiss franc as risk appetite drove investors from the safe haven of the US dollar. The US dollar strengthened against sterling after opinion polls brought the issue of a hung parliament back to the fore. The Governor of the People’s Bank of China stated yesterday that China’s exit from stimulus measures should sooner or later put an end to the de-facto currency peg that currently exists between the renminbi and the US dollar. This could see volatility in the coming months. Today we have a minor measure of consumer confidence out. Call in now for a quote.
Note: All rates are mid market inter bank and indicative at the point of publication.
