The British currency, unable to capitalise on strong early gains, lost ground against the euro yesterday, as an easing of risk appetite wore heavily on the fragile pound.Initially, sterling extended Tuesday’s rebound following a surprising jump in UK consumer sentiment, posting its biggest monthly boost in more than 14 years and signalling growing optimism about the UK economy. Additionally, the pound found support from signals that the Bank of England may not cut its bank reserves deposit rate anytime soon. In the afternoon however the pound gave up its gains, as weak US data brushed off on equity markets and sent the pound back down to a close of 1.0915.
Posts Tagged ‘Speculation’
Sterling relinquished strong gains vs euro yesterday as risk appetite eased
Posted by admin on October 1st, 2009
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Sterling made gains against the kiwi yesterday, but rising risk appetite has supported kiwi advances today
Posted by admin on September 30th, 2009
Evidence that the UK economic recovery is strengthening enabled sterling to reverse a five day slide against the kiwi, closing up at 2.2341. Sterling clawed back nearly two cents, or 0.8%, in the wake of strong data referring to retails sales, credit lending, and a final upward revision to the GDP figure.Sales volumes at UK retailers bounced back to their strongest level for five months in September, reaching levels well above expectations, whilst the second quarter GDP figure in the UK was revised to just a 0.6% contraction. The positive data was offset slightly by a weaker-than-expected UK current account deficit, but investors seemingly overlooked this, with demand for the pound broadly rising.In trading this morning however, the kiwi has advanced, supported by a survey showing business confidence in New Zealand at a ten-year high, which fed speculation of a rise in rates.The kiwi also benefitted from a sluggish dollar and strength in the aussie, which supported appetite for riskier assets.
Aussie has advanced further vs sterling as talk of interest rate hikes is renewed
Posted by admin on September 29th, 2009
Sterling slid for the third consecutive day against the Australian currency yesterday as the pressure of recent events and statements continued to weigh heavily.The aussie pushed higher, gaining another 0.9%, as the pound failed to shrug off comments made last week that a weak currency was in keeping with the BoE’s policy. The aussie dollar was also supported from a rise in commodity prices, particularly gold, which rallied back above $1000 per ounce yesterday. Additionally, risk sentiment among investors returned as stocks in Europe and the US traded strongly, buoying demand for riskier assets.
Sterling continued to slide vs the euro on the run up to the weekend, but has capped its losses this morning
Posted by admin on September 28th, 2009
Sterling fell yet further on Friday on perceptions that the UK currency would be allowed to weaken to help the fragile British economy. The pound dropped to a fresh five-month low against the euro on Friday as traders continued to sell sterling following comments from Mervyn King that sterling’s fall was helpful in rebalancing the UK economy. Some analysts have suggested that these comments which have undermined the UK currency, have become a new policy tool with which the central bank can kick-start the economy. Pressure on the pound was also stemming from the UK’s budget deficit and continued speculation that the BoE might yet loosen monetary policy further.
Forex Weekly Trading Forecast – 09.28.09
Posted by admin on September 27th, 2009
US Dollar: Optimistic Economic Outlooks to Meet Hard Facts This Week Fundamental Outlook for US Dollar: Bullish- The Federal Reserve left rates unchanged, but signaled a more optimistic outlook- University of Michigan consumer confidence jumped to a 21-month high in September- US durable goods orders tumbled 2.4% in August, marking the steepest drop since JanuaryThe US dollar ended the past week marginally higher after the Federal Reserve issued a more optimistic outlook on the economy. In the coming week, though, there will be a variety of growth indicators on hand that may help to signal whether the US recession really ended in Q2.
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The dollar reversed its slide yesterday, buoyed by stronger equities, but has fallen back today
Posted by admin on September 24th, 2009
Despite a reassertion that US interest rates would stay low, the dollar advanced over half a cent against the single currency yesterday as global stocks went into decline. During early European trading yesterday, the intense selling pressure on the dollar abated amid caution ahead of the Fed’s rate decision, with the pair holding around the 1.4800 level.In the evening, the statement from the Fed confirmed speculation that rates would remain low for an extended period of time, which sent the euro to a high of 1.4841.However, the greenback rebounded strongly, as traders remained cautious of betting aggressively against the US dollar following a sudden slide in US stocks.
Forex Weekly Trading Forecast – 09.21.09
Posted by admin on September 20th, 2009
US Dollar Overdue for a Technical Bounce, But Fundamental Reversal…Fundamental Outlook for US Dollar: Neutral- Speculation for rate hikes deferred as fundamentals temper exuberant risk appetite- The steady charge in risk appetite keeps the dollar on the short side of carry interests- Sentiment can often run askew of fundamentals; but what do technicals say about the dollar?The dollar was able to relieve the pressure of suffering its worst trend on recent record by clawing out the first bullish close in eleven consecutive trading days; but that does not mean the burdened currency is necessarily primed for a true reversal.
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