Treasury Select Committee hearings to further grill the Bank of England
26 November, 2013
Today sees a likely quite quiet day on the currency markets with the economic calendar of important data releases absent of almost anything of interest.
Following the recent Bank of England inflation report, this morning we have Treasury Select Committee hearings to further grill the Bank of England as to their policies and the current economic situation. Will recent firm backing for the Pound be further realised as the UK’s economic recovery gains pace? It is hard to say with Sterling struggling to break key resistance levels that have held all year. Many investors feel that the current year long highs are probably the top of the range for now, without some critical data to push the Pound higher.
This afternoon sees some consumer confidence figures from the US, which are expected to show a slight improvement in feelings towards the US economy’s situation. Watch for any surprises here as the US Dollar is already struggling and if the data fails to achieve the hoped for improvement things could worsen for the Dollar and it’s pegged currencies.
Many of our clients have been taking advantage in recent days of the Australian Dollar buying rate being the best for quite a number of years. This situation might have turned overnight with comments from the Reserve Bank of Australia deputy governor Philip Lowe. One of the reasons for the recent Aussie Dollar weakness had been comments from the RBA governor that intervention to bolster the Australian economy could not be ruled out. This prompted fears that one of the more robust economies in the last few years might not be doing as well as many thought and the Aussie Dollar suffered as a result. However Lowe last night announced that “the threshold for intervention is fairly high”, and in the drop of a hat the market reacted to this assuaging news and the Aussie Dollar found some strength again. Rates are still close to the 3 year highs we have seen recently, so there is still the opportunity to take advantage if you have a need to send some money to Australia.
As always keep in close touch with your CI account manager if you have an upcoming currency requirement to be kept informed on what is happen across the markets and the options that are available to you.
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