US Dollar:
The dollar rose broadly overnight, recovering some losses made the previous day against higher-yielding cur-rencies such as the Aussie, as investors covered short dollar positions. The greenback had fallen on Wednes-day after a benign inflation reading supported the Federal Reserve's renewed pledge to keep interest rates near zero for a few more months. Short-term players trimmed their stretched dollar short positions against the Cana¬dian dollar which hit a 20-month high the previous day, helped by higher oil prices. But gains in the dollar were limited as investors found little immediate reason to add dollar holdings after the Fed reiterated its commitment to low interest rates, which had in turn boosted the attractiveness of higher-yielding currencies. "The market has not been able to find a clear direction for the dollar yet after getting done with major central bank events this week," said Hiroshi Maeba, executive director of forex trading at Nomura Securities.
DATA: Core CPI, Unemployment Claims and Philly Fed Manufacturing Index.
Pound:
Sterling recovered ground against the dollar and the euro in the wake of a sharp fall in jobless claims and infla¬tion warnings from the Bank of England. The pound advanced nearly 1pc to trade at $1.537 and climbed to 1.11 against the euro. The gains were triggered by an unexpected 32,300 drop in dole queues in February – the sharpest monthly decline since 1997. Adding to sterling's momentum, minutes from the BOE's latest rates meet¬ing showed that some Monetary Policy Committee members are becoming more worried about inflation. The Bank said: 'It was increasingly likely that CPI inflation would remain well above the target over the months ahead. 'Against that background, there was a risk that the public's expectations of inflation over the medium term might begin to rise.' The Bank is mandated to keep inflation close to 2pc, but the Consumer Prices Index surged to 3.5pc in January and is widely expected to remain elevated. Still, the MPC was unanimous in holding rates at 0.5pc and keeping quantitative easing paused at £200bn.
DATA: Public Sector Net Borrowing,.
Euro:
The euro fell for a second day against the dollar and yen amid concern Greece will fail to secure financial assis¬tance from European Union, reducing the appeal of assets in the 16-nation region. Europe’s currency weakened versus 15 of it’s 16 major counterparts after Dow Jones Newswires said Greece may seek aid from the interna¬tional Monetary Fund during the April 2-4 weekend. Greece is not hopeful of getting financial aid at a European summit to be held on March 25, Dow Jones reported, citing an unidentified Greek official. Prime Minister George Papandreou is in contact with IMF Managing Director Dominique Strauss-Kahn, the report said.
DATA: No major data to be released today
General:
• The Canadian dollar strengthened against the U.S. dollar Wednesday, hitting its highest level in 20 months, and parity with its U.S. counterpart is in sight. The currency retreated only somewhat later in the day, closing just above 1.01 mark, having been stronger for 12 of the past 13 trading days.
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| GBP/USD | 1.5266 |
| GBP/EUR | 1.1168 |
| EUR/USD | 1.3666 |
| GBP/JPY | 137.43 |
| GBP/AUD | 1.6556 |
| GBP/NZD | 2.1542 |
| GBP/ZAR | 11.147 |
| GBP/CHF | 1.6136 |
| GBP/CAD | 1.5400 |
| GBP/SGD | 2.1245 |
| GBP/THB | 49.033 |
| GBP/HKD | 11.828 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 6851