US Dollar:
We have seen a nice move for the Dollar against the Euro over the last few days . It reached 1.4045 in Tokyo earlier today (its low since March 29th). A report on Friday by John Taylor –founder of the worlds largest cur¬rency hedge fund-said the rally in higher yielding assets is coming to an end with Europes soverign debt crisis resurfacing and the banking system unsteady. This same gentleman predicted several times during the course of 2010 that the Euro will eventually fall to parity against the dollar. Time will only tell if this was a clever call.
DATA : 13.30 TIC Long Term Purchases
Pound:
The pound in general struggled on Friday after the better than expected figures from Euroland ( see below ). A report also showed that UK living standards will fall and both of these factors weighed on the Pound. It fell against most of its 16 most traded peers. All of the above gave the markets the view that we will now see rates rising in Euroland before we see a rise here. High inflation driven by the VAT hike and increases in food, energy and clothing is weighing on the Pound. As reported last week we could see this go as high as 5% this year. The sentiment appears to be that with Inflation this high it will be very hard to raise rates. Mervyn reported last week that he does not do “gestures” which means that when rates do finally go up he wants it to be at the start of a normalising cycle.
Data: No major data today
Euro:
We saw a decent set of figures from the Eurozone on Friday. All countries produced their growth figures and the markets were ( within reason ) pleased with what they saw. German GDP came in at 1.5% and France showed a 1% increase against expectations of 0.9% and 0.6% respectively. Greece was probably the biggest surprise as they posted figures of 0.8%-its first expansion for around 3 years. Overall the 17 countries produced a quar¬terly rise of 0.8% to follow the previous quarters rise of 0.3% and against expectations of a 0.6% rise this quar¬ter. We have a meeting of European finance ministers starting today and this could weigh ion the Euro as the markets feel that they will not quell speculation that Greece will have to restructure its debt. Greece is expected to ask for additional aid on top of its 110 billion financial lifeline.
DATA : Monday and Tuesday-European Finance Ministers meet
General:
The Australian dollar fell for a fourth consecutive day as commodity prices fell and a report came out showing home loans approvals declining.
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| GBP/USD | 1.6200 |
| GBP/EUR | 1.1470 |
| EUR/USD | 1.4120 |
| GBP/JPY | 131.10 |
| GBP/AUD |
1.5305 |
| GBP/NZD | 2.0650 |
| GBP/ZAR | 11.3600 |
| GBP/CHF |
1.4450 |
| GBP/CAD | 1.5720 |
| GBP/SGD | 2.0200 |
| GBP/THB |
49.00 |
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