22nd January 2014

EUR/GBP Volatility Likely


Pound Sterling

Euro to Pound

Before the release of a business optimism report for the UK the Pound was close to a two-week high against the Euro.

Sterling was little-changed against the US Dollar and softened against a broadly strengthening New Zealand Dollar, but the currency could put in a more impressive performance if the measure of business confidence shows the improvement expected.

GBP/EUR is trading in the region of 1.2131 and GBP/USD is trading in the region of 1.6420

US Dollar

On Monday ‘Greenback’ movement was restrained as local markets closed for Martin Luther King Day. A lack of significant US data could keep US Dollar movement to a minimum again today, although developments in the Eurozone may inspire USD/EUR fluctuations.

USD/GBP is trading in the region of 0.6089 and USD/EUR is trading in the region of 0.7388

Euro

The Euro was brushing a two-week low against the Pound ahead of the release of ZEW economic sentiment surveys for the Eurozone and its largest economy. If the confidence reports show improvement the common currency is likely to adopt a bullish stance.

EUR/GBP is trading in the region of 0.8242 and EUR/USD is trading in the region of 1.3536

Australian Dollar

The ‘Aussie’ continued to derive underlying support from China’s recent growth figures but could be headed for a particularly volatile trading session. Australian consumer confidence and inflation data are due for release from 23:30 GMT.

AUD/GBP is trading in the region of 0.5345, AUD/EUR is trading in the region of 0.6486 and AUD/USD is trading in the region of 0.8776

New Zealand Dollar

Following the publication of New Zealand’s inflation data, which added to the case for the Reserve Bank of New Zealand raising interest rates, the ‘Kiwi’ broadly strengthened. The South Pacific currency closed the local session in a stronger position against peers like the Pound and New Zealand Dollar.

NZD/GBP is trading in the region of 0.5067, NZD/EUR is trading in the region of 0.6133 and NZD/USD is trading in the region of 0.8301

Canadian Dollar

The Canadian Dollar ended yesterday’s stilted trading session little changed against its major rivals. The ‘Loonie’ could experience movement today as a result of Canadian wholesale sales and manufacturing shipments reports, but investors will largely be looking ahead to tomorrow’s Bank of Canada rate decision.

CAD/GBP is trading in the region of 0.5545, CAD/EUR is trading in the region of 0.6727 and CAD/USD is trading in the region of 0.9122 These exchange rates were correct as of 9:25 am


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