21st February 2014

US Dollar Gains on Fed Taper Speculation


Pound Sterling

Euro to Pound

While the Pound began the European session in a slightly stronger position against the US Dollar, the British asset went on to fluctuate as data showed that UK retail sales fell by more-than-expected in January.

Separate figures showed that the UK posted a smaller-than-forecast budget surplus last month.

GBP/EUR is trading in the region of 1.2151 and GBP/USD is trading in the region of 1.6658

US Dollar

‘Greenback’ gains were recorded last night as investors bet that the Federal Reserve will maintain its current policy approach of gradually tapering stimulus. Further US Dollar movement may be inspired by today’s US existing home sales data.

USD/GBP is trading in the region of 0.5998 and USD/EUR is trading in the region of 0.7296

Euro

As European trading began the Euro adopted a bearish stance against the US Dollar and Pound. Although the EUR/AUD pairing advanced, yesterday’s mixed PMI data for the Eurozone restrained the Euro’s upward momentum.

EUR/GBP is trading in the region of 0.8230 and EUR/USD is trading in the region of 1.3706

Australian Dollar

Overnight the Australian Dollar extended declines as the price of iron ore fell and the impact of China’s manufacturing PMI continued to be felt.

AUD/GBP is trading in the region of 0.5396, AUD/EUR is trading in the region of 0.6562 and AUD/USD is trading in the region of 0.8998

New Zealand Dollar

Despite China’s less-than-impressive manufacturing PMI reducing the appeal of commodity-driven currencies, the ‘Kiwi’ was still in line to post a five-day gain against the US Dollar. Next week New Zealand’s trade balance figures and credit card spending data could impact the nation’s Dollar.

NZD/GBP is trading in the region of 0.4983, NZD/EUR is trading in the region of 0.6057 and NZD/USD is trading in the region of 0.8294

Canadian Dollar

Commodity-driven currencies like the ‘Loonie’ took a bit of a battering as the week drew to an end and Chinese slowdown fears resurfaced while the price of iron ore declined. With Canadian retail sales figures and inflation data due for publication during North American trading, Canadian Dollar volatility is likely.

CAD/GBP is trading in the region of 0.5455, CAD/EUR is trading in the region of 0.6610 and CAD/USD is trading in the region of 0.8966

These exchange rates were correct as of 09:50 GMT


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