Sterling gained against the US dollar yesterday as positive retail sales figures and factory orders helped lift the pound back over $1.60/£1 but it struggled to hold above that level. Retail sales rose by 0.5% in October, recovering from the -0.2% fall the previous month. Data also showed that factory orders fell at a slower pace than expected. One piece of bad news out was government borrowing, which hit a record high for the month of £9.8bn. Sterling was supported against the euro after Wednesday’s Bank of England minutes showed that further UK Quantitative Easing is off the agenda for another few months at least. It is a quiet day on the data front today, so ensure you call in to stop any adverse pieces of news impacting your payments next week.
In the Euro zone, the euro strengthened yesterday in response to news that Ireland will receive billions of euros in loans to help ease the banking and debt crisis in the country. The euro gained 1% against the US dollar and Japanese yen on the news, but the recovery may be short lived as investors are likely to become concerned over the risk of contagion – i.e. the debt crisis spreading to countries like Portugal and Spain. Spain is a much larger economy than Ireland and any issues there will cause problems. Today we have German wholesale price inflation so call in now to ensure you get the best rate.
In the USA, unemployment claims came in as expected at 439,000 and manufacturing figures came in much better than expected. Yesterday’s figures from the USA point to an improving picture of the economy, which could see investors and traders pull out of ‘short positions’ i.e. bets against the US dollar that expect it to fall. However, Wednesday saw the lowest annual inflation figure since records began in 1957 – data which clearly supports the Federal Reserve’s recent decision to pump an additional $600bn into the economy. With such mixed messages, it is important to speak to atrader to help you buy at the right time.
Elsewhere, Chile’s economy grew at the fastest rate for 5 years in the 3rd Quarter as data showed GDP at 7% more from the year before. The Chilean peso has gained by 14% since June. Call in now for a live exchange rate.
EURO/GBP – 1.172
US$/GBP – 1.593
CHF/GBP – 1.574
CAN$/GBP – 1.623
AUS$/GBP – 1.615
ZAR/GBP – 11.153
JPY/GBP – 132.65
HKD/GBP – 12.353
NZD/GBP – 2.057
US$/EURO – 1.358
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