Quiet finish for the month in currency markets

26 August, 2014

Rob Bastin

As the summer holidays draw to an end the markets find themselves in a particular quiet and stable position across most currencies. With all the major data out already sterling exchange rates remain under pressure and remain somewhat short of last month’s peaks. The only data to be released before the bank holiday weekend was the latest inflation figures for Canada. Results came in shy of expectations with 2.1% year on year inflation down from 2.4% last month, subsequently the Loonie was sold off after the announcement making it cheaper to buy.  

World banking leaders gathered at Jackson Hole on Friday for an annual conference. Yellen boosted the greenback with upbeat comments on interest rates saying that ‘if inflation went up more rapidly than expected then increases in federal fund rates could come sooner and rises could be more rapid thereafter’. The Dollar currently continues its fight back against the Euro and Sterling with 6 cents gained against the pound in just one month. Any sellers of US Dollars should be looking to take advantage of current low levels as long term the pound is forecast to fight back. Meantime GBP/EUR has remained unchanged last week with a more selling still evident in the market for the pound but levels continue to hold for now with the Euro also under pressure last week.

This week provides little excitement on the economic calendar so volatility in exchange rates is not something to necessarily be expected this week. The releases worth watching out for however are as below:


1:30pm – US Durable Goods Orders; 3:00pm – US Consumer Confidence


8:55am – German unemployment rate; 1:30p – US Gross Domestic Product


10:00am – Euro-zone Consumer Price Index / Unemployment Rate