The Euro remained under pressure overnight following yesterdays renewed sovereign debt fears falling below 1.27 against the USD in early hours. Disappointing German industrial orders data did nothing to help the Euro yesterday, orders were down 2.2%, much worse than the expected 0.5% drop. Today we also have the German Industrial Production figures which are expected to show a modest rise but anything worse than expected could further hurt the Euro especially against the USD which has seen some of it’s safe haven status return in the recent bout of risk aversion.
The UK received some positive news about the retail sector with a survey suggesting that spending is faring quite well in Q3 in the face of some other evidence suggesting a slowdown from the second quarters strong growth. The BRC retail sales survey showed a rise of 1.0% on a “like for like” basis year-on-year. This was compared to a 0.5% increase last month but these were partly skewed by very week figures in August 2009
Today is a very busy day for data starting with UK industrial and manufacturing data at 09:30 and last month’s unexpected drop in Industrial Production of 0.5% in June investors will be looking for signs that this was just a blip last month. Expectations are for a 0.4% rise month on month for industrial production equating to a 2% rise year on year. Manufacturing production is also expected to come in positive with a 0.3% rise month on month or 4.9% on year. Sterling has already rallied a little from the lows earlier in the week and if these figures come in even slightly above expectations then it should continue to gain especially against the Euro.
The only data out for the Euro today is the German Industrial Production which is expected to show a 1% rise month on month taking it into positive territory but after yesterdays poor figures this may not be as likely although a good figure may do something to curb the recent Euro weakness and claw back some of it’s losses.
The Yen has reached a new 15 year high against the USD and the Swiss franc showing it is definitely the currency of choice for the risk averse. The strong Yen has been a problem in Japan for a while and is seriously hurting exports and although Bank of Japan Governor Masaaki has told of his reluctance to return to quantitative easing the bank may need to do something soon to intervene with the constantly strengthening Yen.
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Posted in Daily Market News on May 30 2014
A generally quiet day yesterday with most rates range bound due to the US holiday but overnight we have seen a new sell off of the Euro. Recently pushing 1.30 against the USD it has fallen to below 1.28 overnight losing ground against most major currencies and allowing sterling to...VIEW FULL ARTICLE
Posted in Daily Market News on Sep 7 2010 by admin