Foreign Exchange Daily Market Update 28/09/11

The Pound closed higher against both the Euro and the US Dollar in the foreign exchange market for the second day running this week. The GBP/EUR exchange rate moved up slightly from the morning’s open at 1.1510 to trade up at 1.1526 by the day’s close following some choppy trading. The GBP/USD exchange rate though showed much better gains, opening at 1.5551, and moving up throughout the day to trade at 1.5687 by the close of the UK business day. The sole piece of economic data released from the UK wasn’t positive however, with September’s CBI reported sales number dropping from -14 to -15; in line with market forecast.

There are no scheduled economic data releases from the UK today; leaving the currency open to risk sentiment and news from the worlds other major economies.

The Euro fell slightly against the Pound, but gained some ground against the US dollar in the currency exchange market yesterday. The EUR/USD exchange rate climbed across the day, from 1.3511 at the market open; trading at 1.3609 by the day’s close. Yesterday’s data release from Europe saw October’s German GfK consumer confidence survey show no change from the previous month, the index reading holding steady at 5.2, which was directly in line with the market forecast, and as such had little effect on the currency market.

Today will see the release of German CPI (inflation) figures, with the market forecast for no change in the annual level of price-growth, but the monthly level is expected to drop slightly, which will ease some pressure on the European Central Bank in regards to inflation.

The US Dollar continued to lose ground against both the Euro and the Pound yesterday, the currency facing headwinds in light of some poor economic data, and also the possibility of a solution for the debt problems in Greece being reached, which has gone some way to ease worried of a crisis in the Euro-zone. Yesterday saw the release of September’s consumer confidence figures; which showed a small increase in positive sentiment from the previous months’ reading of 45.2. The current level was reported as moving up to 45.4; which was below the market forecast for a reading of closer to 46.0.

The US economic docket today will focus on Augusts’ durable goods orders figures, which are expected to have fallen rapidly, indicating that consumers are unwilling to part with their money for large-ticket, long-lasting items such as cars and televisions to focus on spending their money on more essential items. Should this be the case, it would ne an indication of an increase in negative sentiment, and could well weaken the Dollar slightly.

This Daily Market Update is brought to you by The Market Team @ KBRFX – Exchange Rate, Currency Conversion & Foreign Currency Transfer specialists.