US Dollar:
On Wednesday, the dollar fell after the Fed painted a darker picture of the U.S. economy, confirming the pace of the recovery is slowing. Still, the reaction was muted, as "the Fed's stating the obvious," said John McCarthy, manager of currency trading at ING Capital Markets in New York. "We've seen this in the data releases for the past month and a half," he said of a string of worse-than-expected indicators of the U.S. economy, including Wednesday's worse-than-expected retail sales figures. The dollar could see further losses if economic data continue to disappoint and raise further doubts about the viability of the U.S. recovery. But investors remain cautious and aren't yet ready to bet heavily on risk-sensitive assets, said analysts.
DATA : Industrial Production, Capacity Utilisation, Phili Fed, PPI
Pound:
The U.K. pound is likely to consolidate after hitting a more than two-month high against the dollar. Sterling got the boost after the U.K.'s two main measures of unemployment both fell in June and May, while employment rose by the largest amount in almost four years, data showed. Sterling gained more than 0.6% against the greenback Wednesday. Moody’s announcement that Britain’s mortgage lenders will continue to suffer amid un¬certainty over house prices, interest rates and unemployment beyond 2010, has re-enforced the “not out of woods “ impression yet again today. The housing market continues to be probably one of the most important barometers to the man on the street and therefore any negative movement, which is currently the prediction, will hit all important confidence.
DATA : No Data
Euro:
"Euro strength is (because of) the sense the immediate crisis has faded, a by product of the various backstops that the euro governments have put in place," said Ron Leven, currency strategist at Morgan Stanley in New York .Even so, "I certainly don't at this point know anyone who thinks that the euro has changed course," Leven said, with issues of sovereign debt still likely to drag the common currency lower despite its recent show of strength. Judging the turn is anyone guess and if you have exposure mitigate risks unless you can afford a negative move against your requirement, this seems to be the order of the day for quiet some time however it still persists. Stop Orders and Limit Orders on the Online platform are proving useful tools.
DATA : ECB’s Monthly report
General:
Below chart of GBP CAD shows the volatile nature of this CCY pair over the last couple of weeks. Having bro-ken out of the channel towards the end of Jun, coinciding with the emergency budget, meaning strong GBP rally , then saw a retraction approx 50% of this move to now appear to be trending higher again.
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| GBP/USD | 1.5235 |
| GBP/EUR | 1.5325 |
| EUR/USD | 1.1981 |
| GBP/JPY | 135.05 |
| GBP/AUD | 1.7392 |
| GBP/NZD | 2.1205 |
| GBP/ZAR | 11.551 |
| GBP/CHF | 1.6055 |
| GBP/CAD | 1.5807 |
| GBP/SGD | 2.1048 |
| GBP/THB | 49.27 |
| GBP/HKD |
11.911 red-down; blue-up (snap shot) |
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John Paul Georgiou
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