Quiet Start To The Week

Yesterday was a quiet day on the currency markets as we still dealt with the aftermath of the ECB meeting last Thursday. We saw a four cent drop on the pound/euro rates and a similar drop in US dollar/euro as traders priced back out a large portion of the weakness recently seen by the single currency.

We had little to go on with a lack of many ecostats with just German industrial production figures out in the morning which came out a little under expectations. This allowed the pound to make some gains against the euro, clawing back a cent over the day. We did see a strong rally by the US dollar as European markets opened as the pound lost 3/4 of a cent in a sharp half hour of trade.

While investors looked to back the greenback again ahead of the Fed rate meeting next week, the pound faired better against some of the more riskier commodity currencies, with sterling taking three cents off the Kiwi dollar and two off the Aussie. The pound also did well against the euro related pairings, gaining 1.5 percent over the Norwegian krona.

So onto today and again we only have a couple of important stats to ponder. Firstly EU GDP at 10am, with any change to the expectations likely to cause volatility. Then the UK sees the release of the NIESR GDP estimate at 3pm. This isn’t as important as the actual ONS figure but equally can cause volatility if figures differ so worth paying attention too. With 5 hours of trading in between it could be an interesting day for euro buyers and sellers. If this means you, give me of the team a call this morning for some friendly guidance.