US Dollar:
Global markets are little changed for the most part Friday, while investors wait for pivotal US jobs numbers to justify hopes for continuing economic recovery. Investors anticipate an encouraging gain in US em¬ployment although they remain poised to take profit on any disappointing numbers. All the moves yesterday did however go in the greenbacks favour, with the dollar taking large gains against a basket of currencies including the euro and sterling. Over a cent and a half was gained on the single currency as EUR/USD fell below the $1.22 level, and a cent was gained on the pound to push GBP/USD close to the $1.46 mark. Market participants are weary of what are perceived as risky trades, so are continuing to favour the dollar for a safe haven place to hold funds. Talks of a US interest rate rise not so far down the line have also helped the dollar’s position against its major rivals. Focusing on the jobs data later today, most analysts expect the Labor department to report that 500k or more nonfarm jobs were created last month, up from 290k in April and the unemployment rate to have slipped a notch to 9.8% from 9.9%. Data 13.30: Nonfarm payrolls expected 529k from 290k & Unemploy¬ment rate expected at 9.8% from 9.9%.
Pound:
The pound’s position against its European cousin remains bullish as GBP/EUR again try’s to test the 1.20 level. This position is still very much focused on the troubles affecting the southern states of the eurozone which are having a continuing detrimental effect on the single currency, and doesn’t look like moving away from that stance any time soon. Against the dollar we have seen a slightly different picture as the greenback posts gains against most of the majors on interest rate hike talks and the usual run for cover in the safety of the buck in times of global uncertainty in the financial markets. This morning the pound has been little changed as markets await for the key US payrolls data, while players continue to keep the European debt problems in the forefront as worry about contagion hamstrings the euro, to the benefit of the UK currency.
Data just out: Halifax HPI m/m came in at –0.4%, slightly lower than expected.
Euro:
Yesterday saw another poor trading day for the single currency as the euro fell against the majors. Mar-kets now view Italy and Spain as less creditworthy than they were when they formally adopted the euro in 1999. Greece and Portugal spreads had already eclipsed pre-euro levels, and so Italy and Spain are simply joining them and illustrating how the lines of contagion from Greece continue to gather pace. Funds continue to flow out of the single currency as investors try to park their assets in more safe haven places such as the dollar. This saw EUR/USD fall yet again as over a cent and a half was lost against the dollar. The position against the pound saw less of a move against the euro but the currency pair still remains in the favour of the pound as the debt level worries remain more focused in the eurozone than the UK. First quarter GDP in the eurozone is ex¬pected to be unchanged from the preliminary release last month, but interest will be in the breakdown, details of which will be published in the second release.
Data 10.00: Revised GDP q/q expected 0.2%unchanged.
General:
• Spot gold was down $2.20 from New York’s price late Thursday to trade at $1,205.60 a troy ounce.
• This weekend sees the meeting of the G20 take place in South Korea as they look to discuss the state of the fragile global economy.
For more information or to request a call back click here
| GBP/USD | 1.4642 |
| GBP/EUR | 1.2021 |
| EUR/USD | 1.218 |
| GBP/JPY | 135.82 |
| GBP/AUD | 1.7305 |
| GBP/NZD | 2.1367 |
| GBP/ZAR | 11.2404 |
| GBP/CHF | 1.6905 |
| GBP/CAD | 1.5222 |
| GBP/SGD | 2.055 |
| GBP/THB | 47.65 |
| GBP/HKD | 11.4075 blue-up (snap shot) |
These rates are for indication purposes
For more information or to get the latest spot rates contact:
John Paul Georgiou
Senior Foreign Exchange Broker