US Dollar holds fire with Syria vote and riskier trends for EUR/GBP prove fruitful

11 September, 2013

Tom Arnold

Unusually the eyes of the market have not really been trained on data releases, with only figures dramatically different to those expected standing any chance of moving things, as the market instead focuses on Syria and the chances of military intervention. With the Russians jumping on to the back of Secretary of State John Kerry’s idea, almost flippantly suggested a couple of days ago, with regard to Syria putting their chemical weapons under the control of the international community, and Syria seemingly happy with the idea, everything has been scaled back a notch or two. President Obama has deferred the vote in Congress as to the US’s potential intervention to see if the idea has legs and can be put into action, and the markets have taken the opportunity to go “risk on”, having been moving into a more “risk averse” stance with the prospect of a complicated war. Riskier positions such as the Euro and the Pound (over the Dollar) are back on trend. There is some potentially important data out over the next couple of days, with UK unemployment numbers this morning, some ECB speeches tomorrow, as well as a UK inflation report, and Friday’s US retail sales. So with the Syria situation on ice, watch for these and their potential impacts. The Pound is currently riding the “risk on” wave and recent positive data and is delivering the best buying rates for the Euro and the Dollar for some 4-5 months. With some interesting data coming and the uncertainty provided by the US waiting on the Syrian/Russian parlay, it might be worth securing a forward contract for that upcoming currency requirement. As always stay in close contact with your CI account manager to discuss your options for sending your money overseas.