Yesterday’s trading saw Sterling hit the best levels we have seen this week against the Euro whilst losing ground against most other majors.
Euro buyers were handed an opportunity in an otherwise poor daily performance from the Pound, and a lot of the weakness for the Euro appears to be down to Italian politics.
A report suggested that the Five Star and League Coalition plan to eradicate a large amount of Italian debt by way of requesting the ECB to forgive a large sum of bonds bought via Quantitative Easing. This approach had spooked the market somewhat and Euro exchange rates fell against all major currencies. Mario Draghi also commented in the afternoon that he is starting to see increasing political fragmentation in the Eurozone which would not have helped the Euro either.
Sterling however was having a hard day at the office itself, falling against every other major currency but the Euro. It appears that the Pound is still struggling to remain in fashion since the Bank of England backtracked on what seemed to be a nailed on interest rate hike merely a few weeks ago. We have little left in the economic calendar for the U.K this week but there are still plenty of other releases and political issues around the world that may impact your rate of exchange so you do need to have one eye on the market at all times. If you do not have the time to watch the currency markets all day yet you are holding out for a specific rate then let us know about it and we can keep an eye on the latest movements for you. You can set a rate alert with us by email me on email@example.com or you can call our trading floor on 01494 787478.
Next week we have house price data, inflation data, Retails sales data and growth figures so there will be plenty for the market to get its teeth into and a lot for Governor of the Bank of England Mark Carney to review. His comments following the recent interest rate decision suggested that the BOE will be monitoring all economic data extremely closely in the lead up to the next interest rate decision and a good economic performance will be key if we are to see them make their move.
Good economic data will enhance the chances of a rate hike and will strengthen the Pound, weaker data will more than likely lead to Sterling losing value.
To find out current trading levels or to discuss a potential exchange you have in more detail feel free to get in touch with me (Daniel Wright) by emailing firstname.lastname@example.org and I will be happy to reply to you personally.