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Aussie climbs to record high

The pound jumped to a 6 week high against a broadly weaker dollar yesterday after data showed the UK econ¬omy grew by 0.2 percent as expected in the second quarter. Although growth was tepid, the number was met with relief by the market as some investors had positioned for something weaker. Sentiment towards the pound was also helped as the UK statistics office said quarterly growth could have been as high as 0.7 percent but for one-off effects including an extra public holiday in April. But analysts said near-term gains in the pound may be limited due to concerns that weak growth will hamper the government’s efforts to bring down debt as well as keep interest rates down for a prolonged period.
No major data due today.


Nervous investors sent Spanish yields to their highest level since the financial crisis at a €2.9bn debt auction yesterday. The sale saw demand almost halve from the last equivalent auction a month ago. Yesterday’s auc-tion is the second time in a week that Madrid has had to pay through the nose to finance its public spending. Spain has made progress on cutting its budget, but could still miss its deficit target of six percent of GDP this year.  Overnight the single currency reached highs of 1.4536 against a broadly weaker dollar
No major data due today.


The Obama administration threatened a presidential veto of House Speaker John Boehner’s two-step plan to raise the $14.3 trillion debt ceiling and cut $3 trillion in expenditure. A vote on the measure had been scheduled for today and was postponed until tomorrow, still ahead of the August 2nd deadline when Treasury Secretary Timothy Geithner has said the US will run out of options to prevent a default. Ratings Agency Standard and Poor’s reiterated on July 21 that the chance of a cut of the US’s top AAA credit rating is 50 percent in the next three months, which would likely raise the nation’s borrowing costs and weaken the currency. On the back of this we saw the dollar slide from 1.4370 against the euro earlier in the day to highs of 1.4530. Similarly sterling strengthened to as high as 1.6430 against the greenback.
Data 13.30: Core Durable Goods Orders m/m.


• Australia’s dollar climbed to a all-time high after data showed inflation accelerated.
• New Zealand’s currency also climbed to the highest since its was freely floated in 1985 after a survey showed business confidence improved in July.  


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GBP/USD                        1.6400

GBP/EUR                        1.1330

EUR/USD                        1.4475

GBP/JPY                         127.30

GBP/AUD                        1.4820

GBP/NZD                         1.8730

GBP/ZAR                         10.91

GBP/CHF                         1.3120

GBP/CAD                        1.5460

GBP/SGD                        1.9680

GBP/THB                         48.50

GBP/HKD                        12.7800

red-down; blue-up (snap shot)

These rates are for indication purposes only.


For more information or to get the latest spot rates contact:

John Paul Georgiou

Senior Foreign Exchange Broker

+44 (0) 20 7959 6917      


For more information