No change from Bank of England or ECB
3 August, 2012
Yesterday saw the BoE meet for their monthly policy announcement, however we saw no new measures – changes to the interest rate, or any change to the current programme of Q.E.
The ECB also met again yesterday but likewise made no changes. In a press conference afterwards however, ECB President Mario Draghi made a statement that interest rates would indeed be cut again in the future. When interest rates are cut the local currency almost automatically weakens as investors move away into higher yielding positions, and therefore as a result of this the market saw an almost instant drop for the Euro rate including around 1 cent against the Pound.
Today sees PMI data released for the UK and Europe, and retail sales figures in the Eurozone. In recent times these releases have been in the most part negative. So coupled with Draghis’ interest rate admission yesterday, and adding the ongoing and underlying Eurozone issues, it is likely that the markets will remain volatile.
If you have any immediate currency needs, or would like to discuss how we can help you avoid any sudden downturns in the markets, please don’t hesitate to contact your Currency Index broker.
Good luck to Team GB today…..let’s hope they can follow on from yesterdays success and continue on the gold run!
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