The dollar gained today versus most of the 16 main traded currencies as China tightened its lending restrictions, raising risk aversion in

foreign-exchange markets affecting high-yielding currencies the most, as investors search for safer bets.

The U.S. currency continue yesterday’s advance as risk aversion coming from Asia is still playing a major role in market sentiment this week, and the safety provided by assets in the country became one of the best options for these turbulent trading sessions. The euro was one of the biggest losers versus the dollar touching the lowest rate in 2010 today after International Monetary Fund officials affirmed that Greece’s situation is serious, once again making the Southern European nation to affect the outlook for the bloc’s single currency. The New Zealand dollar declined as a report in the nation showed that consumer prices dropped in the country, surprising analysts.

Chinese’s new policy regarding loans to avoid a new credit bubble is decreasing risk appetite, and events in Europe aren’t good either, this is allowing the dollar to outperform most of its trading partners currencies, as the U.S. provided relatively good data today, as analysts affirmed.

EUR/USD bottomed at 1.4095 as of 17:17 GMT from a previous rate of 1.4272 yesterday. NZD/USD traded at 0.7190 from 0.7387.

If you want to comment on the U.S. dollar’s recent action or have any questions regarding this currency, please, feel free to reply below.

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The U.K. currency profited today from an increase in the nation’s house prices, fueling even further speculations that the recession might be ending in Britain, attracting investors to purchase

pound-priced assets in a day of bullish equities markets in London.

In a day of predominant risk appetite as commodities and equities advanced in the U.K., the pound profited from an optimistic scenario in the country as Rightmove Plc, a leading British real estate website, indicated that house prices increased last month, adding evidences for speculations that Bank of England’s current asset purchase program may expire next month and not be extended further, which would certainly allow the pound to climb in foreign-exchange markets. The euro posted a slight decline versus the sterling as traders remained skeptical regarding Greece’s budget deficit and the European Central Bank’s capability of rescuing the Southern European nation from a financial collapse.

Several analysts believe that the pound may outperform multiple key-currencies in foreign-exchange markets this year, as the recession fades away and according to some speculations, the country’s currency would be undervalued. If positive data continues to be published the pound may experience a sharp rally, specially versus a less attractive euro in the following weeks.

EUR/GBP traded at 0.8803 as of 16:14 GMT from an opening rate of 0.8821 when markets opened yesterday. GBP/USD climbed to 1.6333 from 1.6258.

If you want to comment on the Great Britain pound’s recent action or have any questions regarding this currency, please, feel free to reply below.

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The Canadian dollar started another week trading high versus its U.S. counterpart as markets that influence its rates rallied in the start of this week, specially energetic and metallic commodities, before tomorrow’s interest rate decision in the North American nation.

After a rather bearish past week for the crude oil which posted consecutive days of losses as risk aversion rose in Europe and China, the Canadian dollar benefited from a rebound in the oil rates today, as future contracts advanced for the first time in six days. Canada is also a metallic commodity exporter, and as the copper advanced together with stocks in Europe, the loonie advanced significantly versus the greenback in a rather calm trading session due to a bank holiday in the United States. Commodities and equities rates fueled by risk appetite are maintaining the Canadian currency among the best performers this year in foreign-exchange markets.

Analysts remain very confident that the rally in commodities will set the loonie to parity with its U.S. counterpart at some point this year, as the global economic recovery is likely to push the oil and metals up, as manufacturing sectors in Canada’s main trading partners are increasing demand for raw materials by the day.

USD/CAD traded at 1.0254 as of 14:49 GMT from a previous rate of 1.0293 when markets opened yesterday. CAD/JPY advanced to 88.44 from 88.07.

If you want to comment on the Canadian dollar’s recent action or have any questions regarding this currency, please, feel free to reply below.

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The Canadian dollar declined versus its U.S. counterpart and

lower-yielding currencies as risk aversion rose impacting markets with extreme influence in the loonie rates, those of raw materials and equities, which dropped globally this Friday.

The loonie was impacted today as energetic and metallic commodities declined, specially the crude oil, as raw material exports account for more than half of the country’s international trade revenue, in a day of bearish markets in New York and Toronto. China’s new tightening lending policy declined appeal for high-yielding currencies, and despite U.S. mediocre data published in reports this Friday showing a slow down in the country’s inflation, the greenback advanced versus the loonie after touching a three-month low earlier this week.

The Canadian dollar has been fluctuated in almost perfect correlation with commodities in the beginning of 2010, despite the country’s fundamentals, which are also adding confidence for the loonie to gain in currency markets, according to analysts. As the crude oil retreated below $80 a barrel, the loonie’s rally was halted, but may continue if risk appetite returns during the next weeks.

USD/CAD traded at 1.0284 as of 16:38 GMT after touching 1.0219 yesterday. CAD/JPY declined to 88.27 from 88.85.

If you want to comment on the Canadian dollar’s recent action or have any questions regarding this currency, please, feel free to reply below.

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The Australian dollar climbed after employment figures were published in the country with

better-than-expected numbers, adding confidence that the economic recovery in the country is accelerating its pace, spurring demand for assets in the South Pacific region.

After unemployment in Australia declined to 5.5 percent and surprised forecasts that expected an increase, the Aussie dollar gained versus most of the main traded currencies, specially lower-yielding options like the Japanese yen, impacted by the growing risk appetite in Australia.

AUD/CAD traded at 0.9579 as of 02:27 GMT from 0.9504 hours before the employment figures were published in Australia.

If you want to comment on the Australian dollar’s recent action or have any questions regarding this currency, please, feel free to reply below.

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The Canadian dollar profited from a higher risk appetite session today and rebounded versus the yen and its U.S. counterpart as equities rose in North America, allowing the correlated loonie to profit from this trading scenario.

After two days losing in currency markets as concerns that the Canadian economic recovery is not as robust as analysts suggested, the loonie rebounded today, profiting from a positive performance of stocks and commodities, which have an extreme influence in the Canadian currency rates as raw materials exports are responsible for a big cut on the country’s international trade. The Canadian dollar also benefited from a less attractive U.S. dollar, which has been losing its appeal as the nation published several reports which featured data below forecasts, suggesting that interest rates will be not hiked so soon in the world’s wealthiest nation.

Demand for commodities is still playing a major role to back the loonie’s advance, as Canada’s economy, and consequently its currency, will rely on the global economic recovery in the first half of 2010 to determine whether demand for the nation’s raw materials will allow the country to recover steadily or not.

USD/CAD traded at 1.0304 as of 19:42 GMT from a previous rate of 1.0385 in the intraday. CAD/JPY rose to 88.60 from 87.52.

If you want to comment on the Canadian dollar’s recent action or have any questions regarding this currency, please, feel free to reply below.

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The United Kingdom has been showing itself as one of the least resilient nations among the wealthiest countries in the world, and its weak economic data combined with a ineffective monetary policy is likely to set the sterling further down in the first semester of 2010, specially versus

higher-yielding options

Bank of England policy makers insisted to extend its so far frustrated bond purchase strategy, injecting its remaining 200 billion pounds on the program, as interest rates remain at an all-time record low of 0.50 percent, maintaining the pound’s outlook negative, specially as the traders started the year with high levels of risk appetite. Commodities linked currencies like the Australian and the Canadian dollar are likely to rally further versus the pound this year, and demand for energy is likely to favor these oil producer’s currencies, specially for Canada’s currency, as the winter in the Northern Hemisphere has been one of severest in the past year, increasing demand for energy in the United States.

This week will be marked by a monthly manufacturing production report in the U.K., which has provided mixed data in the past months, but nevertheless, as analysts aren’t very optimistic regarding British economic growth in the first quarter of 2010, the pound has considerable odds to lose further versus the currencies above mentioned.

GBP/CAD started this week trading at 1.6495 from as high as 1.6850 one week ago.

If you want to comment on the Great Britain pound’s recent action or have any questions regarding this currency, please, feel free to reply below.

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The kiwi dollar struggled on Friday enabling the pound to jump 1.4%, briefly nearing the 2.30 level, as risk appetite in the market waned.

• Higher-risk currencies struggled to make headway at the end of last week as the rally in global equities in the wake of the positive US GDP data came to an abrupt halt.
• As global stocks fell, investors sought shelter in the haven currencies fuelling a sell-off in the higher-yielding kiwi dollar, buoying the sterling price.
• In trading this morning, the New Zealand dollar has pulled back from six-week lows against the pound, with profit taking in high-yield currencies taking a pause.
• Support has also come from improved manufacturing data in China, a key importer of New Zealand goods, which has outweighed some of the negative sentiment toward the currency.
• Analysts have noted though that reduced support for a rise in interest rates and lower risk appetite may prevent the kiwi from regaining its strong valuation.

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The pound climbed just over two cents against a broadly weakened aussie dollar on Friday with a rise in risk aversion putting selling pressure on the higher-yielding currency.

• Weak data in the US and plummeting global equity markets enable the pound to gain as investors took the opportunity to cash profits in the aussie and retreat to safer assets.
• Analysts have recently noted that the rally in risky assets could come to an end. Conditions for perceived riskier assets to gain requires a flow of positive economic data combined with loose global monetary policies and low interest rates.
• The strong US GDP figure supported the rally in higher-yield currencies, but as the economic recovery shifts the balance in favour of tightening policy, it will likely signal the end of the rally in risky assets.
• However, the aussie is trading strongly again this morning, currently up over a percent, as investors bet that the Reserve Bank of Australia will raise interest rates at their meeting on Tuesday.
• Traders also said that Chinese data showing manufacturing activity at an 18-month high helped to mitigate some of the recent loss in risk appetite, bolstering aussie demand.

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The dollar strengthened, consolidating after broad selling on the back of data showing strong US growth, gaining over a cent on the single currency.

• Equities took a sharp downturn at the end of last week, having rallied after the positive US GDP data, most likely as a result of end of month profit taking, which buoyed demand for the greenback.
• Data also showed that US consumer spending fell for the first time in five months in September, coinciding with the end of the government’s car scrappage scheme.
• The US Commerce Department says spending dropped 0.5% in September, compared with a 1.4% rise in August, which encouraged investors to buy back into the haven currency.
• The US dollar extended gains in the afternoon, pushing the euro down near three-week lows after data showed that a US Midwest manufacturing index was stronger-than-expected failed to heighten risk appetite.
• The euro has climbed in trading this morning with the price currently hovering around the mid 1.47 mark.

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The greeback pulled back from its sharp sell-off on Thursday, as weak US economic data spurred a return to risk aversion.

• In early trading, the dollar continued to lose ground following the better-than-expected US growth data, however the GBP/USD rally was capped at 1.6600, and the UK currency pulled down steadily, eventually closing down 0.6% ay 1.6448.
• US markets went through losses on Friday, with financials and materials leading the path, as risk aversion returned after Thursday’s optimism, strengthening support for the greenback.
• On the macroeconomic front, data revealed that US consumer spending declined 0.5% in September, the largest decline since December 2008, further buoying the dollar rally.
• Positive manufacturing data from the Midwest in the afternoon failed to dent dollar buying in the markets and traders acknowledged that part of this may have been due to month-end flows into the US currency related to foreign portfolios.
• The US currency has continued to climb in trading this morning, currently half a percent up, as investors remain cautious ahead of big events this week, including interest rate decisions in the UK, eurozone and US.

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Better-than-expected GDP figures in the US caused risk appetite to surge across the board enabling the kiwi to post gains of over a cent against the pound.

• The solid GDP figure in the US renewed optimism about recovery in the global economy, prompting investors to buy higher-yielding currencies.
• The kiwi, which has suffered recently on a rise in risk aversion, was able to reverse losses as the positive data encouraged investors to buy up riskier assets.
• However, in trading this morning, the pound is recouping losses, pushing the price back near 2.27 as market participants return their thoughts to the RBNZ’s rate statement on Wednesday where they indicated that interest rates would not be raised for some time.

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Sterling extended its rally, briefly climbing above $1.66 as the dollar sold off broadly after strong economic growth data spurred demand for riskier assets.

• In early trading, the pound found support from data that showed UK mortgage approvals for September increased to their highest level since February last year, exceeding market forecasts.
• Risk appetite was buoyed further in the afternoon after a report showed the US economy returned to growth in the third quarter, boosting stocks and reducing the appeal of the relative safety of the greenback.
• The US economy in the third quarter grew by 3.5% on an annualised basis, beating market expectations of a 3.3% rise and easing recently voiced concerns over the strength of the US recovery.
• Analysts noted that with the US GDP figure meeting market expectations, market players returned to using the dollar to fund carry trades, driving the US currency lower.
• The gains of 1.0% helped propel sterling toward its first monthly advance versus the dollar since July.
• However, gains were capped as the Labor Department revealed that unemployment claims inched lower in the week to 530K but missed forecasts of a drop to 520K.

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The pound advanced by 2.3% against the aussie as risk appetite stumbled in the wake of weak US economic data and a steep slide in global equities.

• In the early session, Australian inflation data was revealed to be slightly below expectations, leading investors to pare bets that the Reserve Bank of Australia will decide on a hefty interest-rate hike next week.
• The consumer price index rose in the third quarter by an annual 1.3%, the smallest gain since the second quarter of 1999, after advancing 1.5% in the previous three months.
• In addition, the price of gold continued to fall in trading yesterday, finding resistance around $1030 per ounce, which dulled demand for the commodity-driven currency.
• The pound was able to reach a three-week high of 1.8290 as investors shed their risky assets yesterday, and the pound could advance further if the US GDP data, released later today, disappoints market expectations.

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The single currency slipped further away from recent 14-month highs against the dollar yesterday, losing nearly a cent to close down at 1.4707.

• The US dollar rose, stretching a rally against the euro to a fourth day, supported by weak U.S. economic data that weighed on equity markets and led investors to seek safety in the greenback and cut exposure to assets perceived as risky.
• Initially though, the euro pared early losses after data showed core US durable goods orders were better-than-expected in September.
• The report revealed that the core figure, which excludes transport equipment, rose by 0.9%, higher than forecasts of a 0.6% rise, strengthening risk appetite in the market.
• However, in the afternoon the euro extended losses after further data showed that US home sales unexpectedly fell, declining 3.6% last month to an annual rate of 402,000, disappointing market forecasts that expected a 2.6% rise.
• Analysts noted that the soft housing sales figure offset positive durable goods orders, given that the latter data is generally volatile and sometimes does not represent the whole economic story.
• In trading today, investors will be eagerly awaiting US 3rd quarter GDP data, released at 12:30.

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The pound continued to advance against a broadly weaker single currency yesterday, hitting a six-week high of 1.1167 as investors trimmed their euro holdings.

• Preliminary CPI data from Germany revealed that consumer prices remained flat on the year in October. Monthly data showed that the index did rise by 0.1% in October from September, though this rise failed to garner support for the euro.
• The markets also saw a slight withdrawal of risk activity yesterday as weak housing data in the US renewed concern over the health of the global recovery.
• The data dragged European equities down to three-week lows, which appeared to impact more severely on the single-currency, enabling the pound to gain.
• This morning, the pound is consolidating its position above 1.1100, with analysts reiterating that sterling is likely to remain in a holding pattern until next week’s BoE asset purchase decision.
• Investors are cautious amid uncertainty over whether the Central Bank will extend their quantitative easing programme, and so sterling movements may continue to be dictated by risk appetite in over the coming days.

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The single currency resumed its upward march against the greenback yesterday, finally broaching the 1.50 mark, to close up half a cent at 1.5015.

• In early trading, the euro retreated from near 14-month highs as some investors bet European policy makers would say they are still concerned that the euro’s strength will harm the economic recovery.
• Analysts also said that the single currency’s sharp fall against the pound weighed on the euro/dollar price, which has recently remained anchored just below the $1.50 level.
• However, the dollar relinquished its gains in the afternoon as rising U.S. equities encouraged enough risk appetite to push the single currency to the highest level since last August.
• In trading this morning, the single currency has once again slipped back as solid data from China gave traders a reason to take profits.
• Analysts have noted, though, that the dollar is likely to continue to broadly weaken as sentiment towards the US currency remains downbeat on the prospect of sustained low US interest rates.

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The pound posted gains against the aussie dollar yesterday as risk appetite waned slightly with weak data emerging from the US and equities slipping back.

• The US PPI unexpectedly decreased by 0.6% in September, disappointing expectations of a 0.1% rise, which raised concern over the strength of the US recovery.
• Data from the US housing market also fell below market forecasts, dulling investor appetite to buy into perceived “riskier” assets, weakening demand for the aussie.
• Sterling’s advance was relatively steady though, with the price rising less than 0.4%, as the broad strength of the Australian currency prevented traders from selling their investments in any great number.
• In trading this morning, the pound is climbing at a good rate, having been given momentum from upbeat MPC minutes, with the price currently over 1.79.

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The single currency slipped back from a fresh 14-month high against the dollar following further comments from the ECB that expressed apprehension over the euro’s strength.

• In early trading, options buying once again prevented the euro from pushing through the psychologically important $1.50 level, posting a high of $1.4993.
• The single currency was supported after further positive corporate earnings weighed on haven demand for the dollar, emboldening investors to sell the low-yielding US unit to fund the purchase of riskier, higher-yielding assets elsewhere.
• However the euro fell back as the ECB repeated their support for the US Treasury’s self-professed strong-dollar policy, and expressed concerns over recent “volatile” trends in the market and the strength of the single currency
• In the afternoon Wall street slipped as tame US inflation data offset strong quarterly earnings from Apple, denting investor appetite to sell the low-yield dollar.
• The economic data, which showed that the US PPI unexpectedly dropped by 0.6% last month, disappointed market expectations and helped the greenback recover earlier losses, though analysts said that it would remain under pressure as long as stocks continued to show an upward trend.

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