Dollar gains strength and sinks the euro

This week has seen the US dollar gain strength across the board benefiting from the raft of data coming from the Euro zone and the UK whilst also posting positive data themselves. It was fairly quiet on the data front although on Monday morning Germany and the European Monetary Union recorded positive Markit Service PMI, Markit PMI composite and Markit Manufacturing PMi all posting higher figures than expected giving the euro some much needed stability following losses to its competitors in the recent weeks.

Tuesday bought more positive data as Germany released Gross Domestic Product data. Figures came in as predicted which added to the Euro’s rally gaining around half a cent on both the pound and the dollar. Bank of England Governor Mark Carney Brought more joy to the euro and dollar as he announced that interest rates will not be raised in the UK in the new year, furthermore he hinted that interest rates could potentially be cut which in turn weakened sterling against its currency rivals however the pound did gain some ground back against the Euro as the US posted better than expected GDP figures in the afternoon, as a result the pound suffered losses against the Dollar.

Wednesday brought high volatility to the markets as George Osbourne addressed the house of commons with his Autumn statement in what was seen as positive. The pound rallied against the Euro gaining half a cent in the afternoon and with the US Durable Goods Orders coming in better than expected this weakened the Euro further resulting in the Dollar making improvements against the Euro. Negative new home sales and jobs data halted the gains against the Euro with the pound reaping the rewards from all data releases gaining on both currency pairings.

Yesterday was a very quiet day on the markets with no trading across the pond as the US nation came together for thanksgiving. This gave an opportunity for the Euro to take back some lost ground and that came from positive data in the Euro zone with Private loans coming in at 1.2% instead of the 1.1% predicted and positive money supply figures. With the US expected to announce interest rates on December 6th this could be seen as why the euro lost some ground later in the day.
Today see the UK release Gross Domestic Product data at 9.30am which is forecast to remain the same at 0.5% from the previous quarter but this is not guaranteed and any movement either way will see a spike in the rates, something to look out for this morning. Later in the day the only notable release is from Germany with the consumer Confidence survey to be announced which could bring volatility to the markets.

As always keep in touch with your account manager today here at Currency Index to stay ahead of the markets with expert advice.