Posts Tagged ‘Sterling’

Pound May Climb On Asset Purchase Program Ending

Posted by admin on January 18th, 2010

The U.K. currency may be experience a shift on its sentiment as speculations suggest that the current quantitative easing measures used by the nation’s central bank will be terminated, as the country starts to publish positive economic reports, suggesting that the recession may be ending in the British Isles. This week will be decisive for the pound as inflation yearly numbers are due to be published the next Tuesday, and if forecasts will be confirmed, the numbers are expected to surpass Bank of England’s target below 2 percent for the first time in seven months, fueling even further speculations that quantitative easing measures will be lifted in the U.K.

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Pound to Decline Versus Higher-Yielding Currencies on Weak Recovery

Posted by admin on January 11th, 2010

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.

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Unchanged Rates and Bond Purchases Maintain Pound Down

Posted by admin on January 8th, 2010

The British currency continued to suffer from its central bank monetary policies as interest rates remained unchanged in the country, suggesting that the recession will remain a reality in England for an extended period.A concerning budget deficit combined with weak economic data has been affecting the pound’s outlook as the Bank of England insists on its asset-purchase program which hasn’t been effective so far, as well as in all-time record low interest rates which decrease the appeal for the sterling in foreign-exchange markets.GBP/USD bottomed at 1.5923 as of 22:21 GMT from a previous rate of 1.6036.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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Pound edged up slightly against the euro on Friday but is down around 0.7% in trading this morning

Posted by admin on November 2nd, 2009

The pound edged higher, achieving its biggest weekly advance against the euro since January, as signs pointed to the UK economic recovery talking hold. The pound/euro pairing was little changed at the end of last week, though sterling did creep up, supported by reports showing gains in consumer confidence and UK house prices. Month-on-month property prices were up for the sixth consecutive month in October and were 2% higher than in the same month the previous year. However, the pace of monthly price rises has eased, going up by just 0.4%.

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With the US exiting recession, investors moved into higher-yielding assets bossting the aussie

Posted by admin on October 30th, 2009

The aussie dollar reversed recent losses yesterday after positive US GDP data encouraged investors to buy-back into perceived riskier currencies. The aussie pulled back nearly two cents, or 1.0%, bringing the sterling/aussie pair back down to trade around 1.80 as the data spurred demand for risk. Investors have been cashing profits in the Australian currency recently as global equities took a downturn, but yesterday’s figure saw traders revive long positions in the aussie. Analysts noted that the figures were a near-perfect combination for riskier assets: strong enough to encourage those with an optimistic outlook on the financial markets, but not too strong to generate expectations of accelerated monetary tightening from the Federal Reserve.

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Sterling edged up against the dollar and is currently consolidating over 1.64 ahead of US GDP data

Posted by admin on October 29th, 2009

Sterling closed marginally up against the US currency yesterday, although the price was pulled back significantly following weak US housing data.In early trading, the pound lost ground to the dollar as falls in equity prices encouraged investors to trim their exposure to perceived higher risk currencies.UK stocks slid to a three-week low, helping to push the price down to 1.63, well under a level just below 1.67 reached only a week ago.The pound was then able to make slight gains in the afternoon after positive durable goods data weakened dollar demand, but the pair found resistance at 1.64.This data was then offset in the afternoon after it was revealed that sales of new homes in the US declined in September, against analyst expectations of a slight increase, which supported an upside movementIn trading today, markets will take direction from the US third-quarter GDP figure at 09:30, which is predicted to show a growth rate of 3.3%. Should it undershoot this forecast, investors are likely to move back into the dollar.

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Falling global equities enabled the pound to post gains against the euro

Posted by admin on October 29th, 2009

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 pound continues its rally against a broadly weaker aussie

Posted by admin on October 28th, 2009

Sterling edged up against the aussie yesterday, benefiting from improved UK sales data, which supported claims that the UK economy is recovering. On Monday evening, MPC member Adam Posen, following negative GDP data, stated that there were still signs of an economic recovery even if Britain is behind other countries in pulling out of the recession. His statement found support yesterday after the UK CBI sales showed month-on-month improvement, beating market expectations and buoying demand for the UK currency. The UK currency has pushed higher in trading this morning after investors pared bets of a steep rate rise in Australia after inflation data did not increase by as much as some had anticipated.

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Pound edges higher against a stronger dollar, which found support from weak consumer sentiment

Posted by admin on October 28th, 2009

Sterling closed up against the dollar yesterday, but slipped back nearly a cent from its intra-day high after a survey showed that consumer confidence in the US disappointed market expectations. In early trading, the markets continued to take the pound higher with analysts noting that long term investors and Asian reserve managers were attracted by sterling’s one-week low. This trend was maintained as the UK CBI retail sales index advanced to a balance of +8 in October from a balance of +3 in September, the largest advance since June 2007, beating forecasts.

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Pound pushes up against the euro, spurred by positive sales figures

Posted by admin on October 28th, 2009

Sterling pushed back over 1.10 in trading yesterday as data revealed a pick-up in UK realised sales dulling concerns over the health of the British economy. The pound continued to recover last week’s losses as the UK CBI realised sales index revealed a significant monthly increase in sales volumes, beating market forecasts. Conversely data also showed that lending to the eurozone’s private sector declined in September compared with the same period a year earlier, highlighting notable constraints on financing to companies and households that could damage the region’s economic recovery.

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Sterling made gains against the aussie as the price of gold fell back

Posted by admin on October 27th, 2009

The pound posted gains against the aussie yesterday, reversing its steep fall at the end of last week as investors cashed profits, closing up 0.8% at 1.7822. The aussie was broadly weaker in trading yesterday as investors took the opportunity to take profits following sharp gains made on Friday.The price of gold also continued to fall yesterday, discouraging investment in the commodity linked currency. Gold quoted around 1053/oz yesterday, though probably due more to profit taking than lack of strength.In trading this morning, the aussie is slightly up on the day, though investors are likely to remain wary ahead of sales data in the UK and a consumer confidence survey in the USIn addition, investors may well caution against long positions ahead of Thursday when the US 3 rd quarter GDP figure is released. The economy is forecast to have grown by 3.3% in the quarter, though if it undershoots this target it could trigger a wave of selling in riskier currencies.

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Sterling is rebounding against a broadly weaker dollar

Posted by admin on October 27th, 2009

Further doubts over the dollar’s reserve status stoked selling in the US currency yesterday, enabling the pound to recover some of Friday’s heavy losses. The greenback lost ground broadly after an article stated that the People’s Bank of China may be considering raising the share of the euro and the yen in its foreign exchange reserves, though the dollar should still remain dominant.However it was later revealed that the article was merely the author’s “point of view,” which capped sterling’s gains, as investors checked their dollar selling.In addition, the pound found support as declines at the end of last week were seen by some investors as over-stretched, suggesting that the market has oversold sterling.However, as the US markets came online, global stocks took a dive into the red, enabling the haven currency to trim its losses.Analysts noted that given the huge amount of bearish trades on the dollar in recent weeks, a near-term dollar recovery could be on the horizon. In trading today, investors will be looking for direction from sales data in the UK, released at 11:00, and a consumer confidence survey in the US, released at 14:00.

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The pound rebounded strongly vs the euro yesterday with analysts suspecting that sterling could be oversold

Posted by admin on October 27th, 2009

After an unsteady early session, the pound rebounded strongly from Friday’s sell off, to close 1.1% up. The pound recovered steadily through the day after data revealed that the German Gfk consumer sentiment indicator dropped to 4.0 from 4.2 in October, weaker than the median forecast of 4.5, dulling demand for the single currency.In addition UK business confidence rose to the highest in 18 months, according to a third-quarter survey, with 19% of executives polled saying the outlook for business is “good” or “very good,” up from 9% in the previous quarter, which stoked demand for the pound.Analysts hypothesised that the pound may be considerably oversold at its current value, which does present a good opportunity for British businesses.Analysts also noted two opposing arguments developing: the first is a widely held view that based on better PMI survey data there is a good chance that GDP data for Q3 will be revised up.

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Sterling halted its recent rally and is slipping back sharply against the kiwi as UK GDP figure disappoints

Posted by admin on October 26th, 2009

The pound was broadly sold on Friday following a weak GDP figure, losing three cents to the kiwi dollar, to close back down at 2.1607. Data revealed that Britain’s economy has now shrunk for six quarters after it contracted by 0.4% in the most recent quarter, the longest period of contraction since records began in 1955. Analysts have now renewed their discussion over the possibility of the Bank of England retaining, or even extending, its £175 billion QE programme, which would compound sterling’s weakness. The news also confirmed that the BoE are likely to keep the benchmark interest rate at a record low of 0.5% firmly into 2010, lessening the appeal of sterling assets.

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Sterling fell back significantly against the dollar on Friday, as GDP figure disappoints the market

Posted by admin on October 26th, 2009

Sterling lost three cents (1.9%) to the dollar, as a weak UK quarterly GDP figure abruptly halted the pound’s recent rally. The greenback gained the most daily value against the pound in a month as the UK’s economy unexpectedly contracted in the third quarter, giving the Bank of England more reason to expand emergency measures to spur growth. It is the first time UK gross domestic product has contracted for six consecutive quarters, since quarterly figures were first recorded in 1955. The pound fell more than a cent against the US dollar following the release of the figures, losing 0.6% in two minutes, with traders particularly concerned that the UK may turn out to be the only major economy still in recession.

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