News

Portugal next for EU bailout?

28 July, 2011

CurrencyIndex

The Eurozone is urging Portugal to seek aid. Portugal’s bonds fell on concern they will follow Ireland and Greece and present a formal request to Europe’s rescue fund, similar to that of Ireland earlier in the week.

As a result the Euro has been slowly weakening (getting cheaper) this week, and we now have the best rates for sending Euro payments since mid-September. Conversely, investors are buying up US Dollars, which has brought the exchagne rate down to its worst level for a month.

GDP revised slightly upwards

28 July, 2011

CurrencyIndex

This morning’s GDP figures showed a slight upward adjustment to previous figures for the third quarter of the year.

The UK economy grew 0.8% in the 3 months to the end of September, or 2.8% in the 12 month period.

Sterling gained slightly on the news, and with no more major UK data out this week, securing a rate for your overseas transfer now is looking reasonable.

Euro falls, Dollar rises

28 July, 2011

CurrencyIndex

The Euro has weakened significantly today, as the political problems in Ireland continue.

The main move has been between the Euro and US Dollar, which has been back in demand as a “safe haven” currency.

The result is something of a see-saw with the Pound stuck in the middle. We have improved rates for sending money in Euros, but worse rates for buying US Dollars.

Tomorrow’s UK GDP figures are likely to turn focus back to sterling, so if you need to secure Euros in particular you might like to contact Currency Index for a quote before the data release at 9.30 am.

Currency news this week 118

28 July, 2011

CurrencyIndex

The main release this week is the second estimate of Q3 GDP, which is published on Wednesday. Any downward adjustment in the UK’s official growth figures would be likely to hurt sterling.

We also have the breaking news of the EU bailout of the Irish economy. Although you might expect the Euro to weaken as a result, the UK is also likely to contributing billions via the EU, so the Pound is not immune to any fallout.

This week’s full calendar of releases likely to affect exchange rates is below. Contact Currency Index for the latest rates for your own transactions, and views on what might happen this week and further ahead.

Monday 22nd
1500 – Eurozone consumer confidence
1615 – Speech: European Central Bank President Trichet

Tuesday 23rd
0200 – New Zealand inflation expectations
0700 – German GDP
0900 – Eurozone manufacturing & services growth
0930 – UK mortgage approvals
1200 – Canadian CPI inflation
1330 – US GDP & Canadian retail sales
1900 – US Federal Reserve minutes

Wednesday 24th
0930 – UK GDP second estimate Q3
1330 – US jobless claims & personal expenditure

Thursday 25th
US bank holiday (Thanksgiving)
0815 – Swiss employment level

Friday 26th
No major data

Sterling recovers yesterday’s losses

28 July, 2011

CurrencyIndex

Having fallen back yesterday, sterling has recovered somewhat today, despite public borrowing figures this morning being much worse than expected at £9.77bn for October.

Retail sales figures were not so bad, and with the possibility of an Irish economic bailout looking more likely, the Euro is also struggling. Against the US Dollar, rates have also recovered, as volatility continues in fragile economic recoveries.

There is no major data out tomorrow, but we have speeches from the Federal Reserve chairman (Ben Bernake) and European Central Bank president (Trichet), at 2.15pm and 9.15am respectively.

Please contact Currency Index for the latest live rates for your own transaction.

Bank of England split 3 ways again

28 July, 2011

CurrencyIndex

The Bank of England did not move nearer to further Quantitative Easing in their November meeting, according to their minutes released today.

7 of the 9-strong committee voted for no change, with one voting for more QE, and one voting for an interest rate rise – exactly the same result as October.

The Pound gained a small amount of value after the minutes were released.

Meanwhile EU finance ministers are meeting to discuss a possible bail-out of the Irish economy. The Euro could be affected if the Irish government asks for help, although when a rescue package was announced for Greece earlier this year, the Euro strenghtened (became more expensive) as markets saw the bailout as helping the single currency zone.

High inflation forces letter to Chancellor

28 July, 2011

CurrencyIndex

This morning’s UK inflation figures (3.2% for the previous 12 months) are again above the government’s targets, forcing Bank of England Governer Mervyn King to write another explanatory letter to the Chancellor.

While the figures are unlikely to spark any short-term interest rate rises, they should be viewed as sterling-positive. Unfortunately, half an hour after the announcement, Eurozone inflation and economic sentiment were released at higher than expected levels, giving the Euro some retaliatory strength and reducing exchange rates for the rest of the day.

Tomorrow morning’s Bank of England Minutes, to be released at 9.30am, are now crucial to the short-term movement of the Pound. If any of the committee voted for further quantitative easing this month, we could see the Pound’s gains of the last week quickly disappear.

This week’s economic news

28 July, 2011

CurrencyIndex

We have plenty of important data out this week which is likely to move exchange rates – including key inflation, unemployment and retail sales figures in the UK, as well as the all-important Bank of England minutes on Wednesday, which will reveal whether more Quantitative Easing was considered this month.

With sterling still vulnerable to any negative news, speak with your Currency Index broker about your own transaction to avoid being caught out by any sudden moves in the market.

Monday 15th
1000 – Eurozone trade balance
1330 – US retail sales

Tuesday 16th
0930 – UK CPI & RPI inflation
1000 – Eurozone CPI inflation & German ZEW sentiment survey
1330 – US PPI inflation
1415 – US industrial production

Wednesday 17th
0930 – UK earnings, unemployment & Bank of England minutes
1000 – Eurozone construction output
1330 – US CPI inflation & housing starts

Thursday 18th
0715 – Swiss trade balance
0930 – UK public borrowing & retail sales
1500 – US manufacturing

Friday 19th
0700 – German PPI inflation

Pound pushes higher against Euro

28 July, 2011

CurrencyIndex

Rates for sending money in Euros are now at their best for 6 weeks, after the Bank of England inflation report was followed by news of economic woe in Spain (where growth is approaching zero) and Ireland which weakened the Euro.

Worries about Quantitative Easing in the UK are now receding a little, although with 6 consecutive days of improvement in the Pound-Euro rate, there may be some profit-taking by investors as the weekend approaches, which could bring the rate back down.

Inflation report boosts sterling

28 July, 2011

CurrencyIndex

This morning’s Bank of England inflation report has given the Pound a timely boost, as Governer King took a neutral approach and did not mention further quantitative easing.

Furthermore, with the outlook still likely to give high inflation in the coming months, there may even be talk of UK interest rate rises next year, depending on the stability of the recovery. The Bank do not see a significant likelihood that we will slide back into recession.

As a result of the report, the Pound has spiked against the Euro and US Dollar, gaining over a cent against both currencies.

Contact Currency Index for the latest quote on your own transaction.