Category Archives: Currency News

Currency Matters

Most of the focus last week focused on Spain as the Spanish government committed itself to meeting tough deficit targets laid out in its 2013 Budget. Additionally, the results of an independent bank stress test were released last week showing that Spain will require a further EUR 59.3 billion to stave off a serious economic downturn. The path has now well and truly been paved for Spain to seek financial assistance from the EFSF/ESM (a bailout), which is something we will likely see before the end of the month.

This week the BoE and ECB will be holding monetary decision meetings and whilst there is the possibility of interest rates being adjusted, it is expected that they will remain unchanged in October. Other key pieces of economic data being released this week include a number of PMI results from the Euro zone and the US, as well as US unemployment and payroll figures.

Please find a summary of this week’s economic calendar below:

01.10.12
08:58 EU Markit Manufacturing PMI
09:28 UK Markit Manufacturing PMI
09:30 UK Mortgage Approvals
09:30 UK Consumer Credit
10:00 EU Unemployment Rate
13:58 US Markit Manufacturing PMI
15:00 US Construction Spending
15:00 US ISM Manufacturing PMI

02.10.12
05:30 RBA Interest Rate Decision
09:30 UK PMI Construction

03.10.12
09:00 EU Markit Services PMI
09:28 UK Markit Services PMI
10:00 EU Retail Sales
13:15 US ADP Employment Change
15:00 ISM Non-manufacturing PMI

04.10.12
12:00 BoE Interest Rate Decision
12:00 BoE Asset Purchase Facility
12:45 ECB Interest Rate Decision
13:30 ECB President Draghi’s speech
13:30 US Initial Jobless Claims
19:00 US FOMC Minutes

05.10.12
11:00 German Factory Orders
13:30 US Nonfarm Payrolls
13:30 US Unemployment Rate

01.10.12 Mark Webster

Economic Calendar

This week sees the release of a number of important pieces of economic data including the much anticipated UK GDP figures on Thursday 27th September. We also have a key meeting between German Chancellor Angela Merkel and European Central Bank President Mario Draghi.

Please find a summary of this week’s economic calendar below:

24.09.12
09:00 German IFO data
20:30 FOMC Member Williams Speech

25.09.12
German Chancellor Angela Merkel will meet European Central Bank (ECB) President Mario Draghi in Berlin
07:00 German Gfk Consumer Confidence Survey
09:30 British Bankers’ Association Mortgage Approvals
14:00 ECB President Draghi’s speech
15:00 US Consumer Confidence
18:30 Timothy Geithner US Secretary of the US Department of Treasury Speech

26.09.12
German 10 year Bond Auction
00:00 German Consumer Price Index
09:30 UK Bank of England Credit Conditions Survey
15:00 US New Home Sales

27.09.12
07:00 UK Nationwide Housing Prices
08:55 German Unemployment rate and change
09:30 UK 2nd quarter GDP
13:30 US 2nd quarter GDP

28.09.12
13:30 US Core Personal Consumption Expenditure
13:30 Canadian GDP data

Currency Matters

GBP/USD has climbed to its highest level since 30th April and currently trades at 1.62 on the interbank market. Strong Resistance is expected at 1.63. If you have any upcoming requirements to buy USD, please do not hesitate to contact a dealer on telephone 01695 581 669 for a live quote.

Currency Matters can offer a number of products which can help you plan your future currency requirements. By using a Forward Contract it is possible to purchase currency today at a guaranteed exchange rate for settlement at a later date. A small deposit is required to secure a Forward Contract with the balance due by the agreed future value date.

Currency Update

Yesterday Wednesday 15th saw Greece’s troubles resurface. With Greece facing a deepening recession, the Greek Prime Minister is set to meet with his French, German and Luxemburg counterparts next week to persuade Eurozone leaders to extend the period of austerity from two to four years, essentially planning to reduce the Greek budget deficit by 1.5% of GDP annually compared to the previous agreement of 2.5%. Due to the slower pace of deficit reduction it is believed an additional £20bn of funding would be required to support Greece.

In the UK, yesterday’s jobs figures continued to defy the recession with unemployment down to 8% and the claimant count dropping by 5,900 in July. Minutes released by the Bank of England also confirmed that the Monetary Policy Committee was unanimous in its decision to leave the bank rate unchanged at 0.5% and to maintain its Quantitative Easing Asset Purchase Programme at its current level of £375bn. Unlike in previous meetings, the bank did not hint towards a bias of further rate cuts giving Sterling a further boost. It is expected that the Bank will gauge the impact of the new Funding for Lending Scheme and the completion of its current £50bn extension of QE in November before it makes a decision on more monetary easing. Today, UK retail sales also beat market expectations growing by 2.8% year on year.

The better than expected news from the UK, coupled with the Eurozone’s on-going troubles has pushed GBPEUR higher towards 1.28, currently trading at 1.2793 (EURGBP 0.7817).

Elsewhere the Pound trades between 1.56-1.57 against the US Dollar and the Euro trades at 1.23-1.24 against the US Dollar on the interbank market.

Please do not hesitate to contact the dealing team on +44 (0) 1695 581 669 for a live quote or for advice and tailored solutions to your currency requirements.

16/08/12 10:30

Contraction in UK GDP

The Pound has fallen back below 1.28 against the Euro and back below 1.55 against the US Dollar following this morning’s preliminary UK GDP data release. The data showed that the UK economy contracted much more than many economists expected.

In the second quarter UK economic output plummeted, contracting -0.7% quarter on quarter and contracting -0.8% year on year compared to a median forecast of -0.2% QoQ and -0.3% YoY. Whilst factors including the poor weather and the Jubilee bank holidays may have exaggerated the fall in GDP, underlying economic growth is expected to be close to flat or declining over 2012 despite a predicted improvement in the third quarter.

With UK inflation falling back towards the target of 2% (currently at 2.4%) and the economy in contraction, the likelihood of further Quantitative Easing and an even greater prolonged period of low Bank of England interest rates (currently 0.5%)has increased.

Please do not hesitate to contact the dealing team on +44 (0) 1695 581 669 for a live quote or tailored solutions to your currency requirements.

11:00 25/07/12

EURO

The Euro has continued to come under strong selling pressure as the European Central Bank has indicated that it will not accept Greek government bonds as collateral. EURUSD has fallen from the morning high of 1.2282 to a low of 1.2144. 1.2144 representing the lowest EURUSD exchange rate since June 2010 when the rate hit a low of 1.1876.

The Pound has made strong gains against the weakening Euro hitting a high earlier of 1.2866, the highest level since October 2008. Against the US Dollar the Pound tracked the sharp falls in EURUSD with GBP falling from 1.5724 to a low of 1.5626.

20/07/12 15:20

Currency Matters

Currency Matters are currently able to offer GBPEUR @ 1.24-1.25. The GBPEUR exchange rate has not been significantly higher than its current level since 2008.

Currency Matters can offer a number of products which can help you plan your future currency requirements. By using a Forward Contract it is possible to purchase currency today at a guaranteed exchange rate for settlement at a later date. A small deposit is required to secure a Forward Contract with the balance due by the agreed future value date.

If you are paying or receiving foreign currency we can help save you money.

Please do not hesitate to contact the dealing team on +44 (0) 1695 581 669 for further information or for a live quote.

08:00 06/07/12

BoE and ECB

As expected the Bank of England has increased its programme of Quantitative Easing by an additional £50bn taking the total asset purchase scheme to £375bn. The Bank also decided to hold the bank rate at 0.50%.

In Europe, the European Central Bank cut its key interest rate by 0.25% to 0.75% a record low.

On the interbank market the Pound has climbed back above 1.25 against the Euro, currently at 1.2525. Whilst the Euro has fallen back below 1.25 against the US Dollar and currently trades at 1.2440. The Pound continues to trade between 1.55 and 1.56 against the US Dollar.

Please do not hesitate to contact the dealing desk on +44 (0) 1695 581 669 for a live quote.

05/07/12 13:10

Bank of England

Minutes released today by the Bank of England have revealed that the Bank came close to extending its programme of Quantitative Easing (QE) as four of the nine member Monetary Policy Committee voted to extend QE. Three members including Bank of England governor Mervyn King voted to extend QE by an additional £50bn whilst one member voted for a smaller addition of £25bn. The Bank also considered the merits of cutting the Bank Rate from 0.50% but concluded that a rate cut had no advantages over more QE.

As previously discussed, further QE from the Bank of England continues to pose a risk to Sterling’s value. On release of the minutes at 09:30 the Pound fell back below 1.24 against the Euro hitting a low of 1.2350 and back below 1.57 against the US Dollar hitting a low of 1.5650 before recovering back to 1.5730 against the US Dollar and 1.2385 against the Euro.

10:00 20/06/12