Foreign Exchange Daily Market Update 27/10/11

The Pound finished marginally higher against the Euro, but fell just over a cent against the US Dollar in the foreign exchange market yesterday. The GBP/EUR exchange rate picked up from the morning’s open at 1.1490 to trade at 1.1495 by the close of the UK business day. The GBP/USD exchange rate however; fell across the course of the day; falling from 1.6011 at the morning’s open, to trade down at 1.5907 by the market close. There was no significant economic data released from the UK yesterday, with the depreciation against the US Dollar possibly being attributed to shifts in risk sentiment in regards the on-going woes in Europe.

Today will see the release of October’s CBI reported sales numbers; with the market forecast for a decline to around -16, lower than the previous month’s reading of -15, which could put a small amount of pressure on the Pound.

The Euro declined slightly against the Pound, but fell more heavily against the US Dollar in the currency exchange market yesterday. The EUR/USD exchange rate fell throughout the day, from the market open at 1.3933 to trade down at 1.3837 by the close of the European trading session. The European Central Bank (ECB) released its bank lending survey yesterday; showing that demand for year-long loans from the ECB was weaker than analyst’s initially forecast. The central bank announced it will lend banks 56.9 billion euros for 12 months; less than the median forecast of 70 billion euros in a Bloomberg News survey, and will also lend 44.6 billion euros for three months tomorrow, when 85 billion euros in three-month loans mature. The 3-month figure is also less than the 50 billion euros predicted in the Bloomberg survey.

One of the bigger events in focus for Europe yesterday was the EU leaders’ summit; which had slightly spooked markets with the cancellation of the finance ministers meeting – indicating that a detailed solution to the current debt woes was still far off. There was some resolution last night however, with the announcement that EU leaders have agreed to extend the EFSF fund to around €1 trillion, and will force banks across the region to increase their capital reserves. In regards to Greece specifically; the nation will have to reduce its public debt to 120% of GDP by 2020, with private investors agreeing to a voluntary bond swap that will wipe away 50% of the country’s obligations. Euro Zone member states will contribute up to €30 billion in additional capital while the “official sector” – presumably the EU – will provide additional financing up to €100 billion, for a total of €130 billion in new aid. This may bring some comfort to the market; but as many market experts have indicated, this is not a complete resolution, and may only serve to extend the problem.

In regards to economic data from Europe today; we will see the release of German CPI (inflation) figures for October, which are expected to show a slight slowdown in inflation which would be welcomed by the region. The Euro-zone business climate indicator figure for October will also cross the wires today, with the expectation for a fall in the level, which would not be positive for the single-currency.

The US Dollar did benefit from the European worries yesterday; gaining nearly a cent against both the Pound and the Euro. There was disappointing economic data released from the US though; with September’s durable goods orders showing a sharp drop from -0.1% to 0.8%.
Today will see the release of pending home sales numbers for September, which are expected to fall, but are unlikely to influence the market too much as the main focus will be on the reading of 3rd quarter (annualized) GDP this afternoon. The market forecast is for an increase in growth to around 2.5% which could see the Dollar gain some further strength in the market.

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

Daily Foreign Exchange Market Update 26/10/11

The Pound finished yesterday slightly higher against the Euro, but a touch lower against the US Dollar in the foreign exchange market. The GBP/EUR exchange rate which opened at 1.1491 finished the UK business day trading at 1.1501 with the GBP/USD exchange rate closing at 1.5994, down from the morning’s open at 1.6007 following a very choppy trading session. There was a small disappointment in terms of UK economic data yesterday as September’s BBA loans for house purchase numbers showed a decline from 35,009 to 33,130 amid market forecasts for a sharp increase.

There is no significant market-moving data scheduled for the UK today; leaving the currency open to shifts in risk sentiment and news from the world’s other major economies.

The Euro ended the day marginally lower versus both the Pound and the US Dollar in the currency exchange market. The EUR/USD fell across the day from the morning’s open at 1.3927, to trade at 1.3906 by the market close. There was some positive data release form the Euro-zone, with November’s German GfK consumer confidence survey showing a small increase to 5.3, up from the previous month’s reading of 5.2.

Today is likely to be a very high-pressure day for the Euro. This morning will see the European Central Bank (ECB) release its latest bank lending survey; which will give some insight into how much extra capital Euro region financial institutions have been seeking; in what are turbulent times for banks trying to reduce their risk levels and steady their balance sheets. The main focus though will be on the EU summit in Brussels; with the market expecting European leaders to announce an increase in the size of the European Financial Stability Facility (EFSF) to around €1 trillion, a commitment to a further Greek bail-out and also an injection of further capital into European banks Despite the market feeling that resolution may be nearing; there has been a shock in the cancellation of the EU finance ministers meeting that was scheduled for today; which would suggest that a detailed solution is unlikely to be produced this evening. There are huge political connotations to any sort of resolution, with many European nations most notably Germany facing the possibility of political rebellion as many parties feel that the risk being imposed to support other member states will prove to be the beginning of the end.

The US Dollar, which would traditionally benefit from turmoil in world markets failed to make any significant gain against the Pound yesterday, and only rose marginally against the Euro. The currency was hit by a hefty drop in consumer confidence levels for October, the headline number falling from 46.4 to 39.8 amid a progressively worsening outlook across the nation.

Today will see the release of September’s durable goods orders figures, with the market forecast for a fall in orders, from 0.1% to around 0.9%, which could see the Dollar weaken further.

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

Daily Foreign Exchange Market Update 25/10/11

The Pound closed out the day slightly lower against the Euro, but higher versus the US Dollar in the foreign exchange market yesterday. The GBP/EUR exchange rate fell from the morning’s open at 1.1485 to trade down at 1.1477 by the UK market close. The GBP/USD exchange rate however picked up from 1.5952 to trade up at 1.5983 by the market close, with the rate breaking 1.60 in the early hours of this morning; before pulling back slightly. There were no significant data releases from the UK yesterday, with the currency market responding to shifts in risk sentiment and news from the world’s other major economies.

This morning will see the release of September’s BBA loans for house purchase figures, with the market forecast for there to be an increase in the overall number; from 35,226 in the previous month to around 36,000; which could be positive for the Pound as it would indicate an improvement in a small part of the credit market.

The Euro lost ground against the Pound, put pulled back against the US Dollar yesterday in the currency exchange market. Despite ongoing issues in regards to the regions debt woes, the currency managed to regain nearly half a cent against the Dollar, the EUR/USD exchange rate rising from 1.3889 to trade up at 1.3925 by the market close. The overall view of yesterday’s economic data released from Europe was negative, with Euro-zone PMI manufacturing and services indices both falling in October, as well as German PMI manufacturing falling for the same period. There was a small increase in German PMI services data for October, but it was not enough to change the negative outlook.

This morning has already seen the release of German GfK consumer confidence numbers for November, and there was a surprise pick-up in the overall level, from 5.2 to 5.3 for the month. The news had hardly any effect on the market though, with the Euro still facing the potential of some very choppy movements in the coming days.

The US Dollar weakened against both the Euro and the Pound in yesterday’s trading, and the currency was not helped by negative data released; with the Chicago Fed National Activity Index for September showing a decline from the previous month’s level of 0.59, down to 0.22.

The currency is likely to take direction from today’s key release of consumer confidence numbers for October, with the market forecast for an increase in positivity, which could help the Dollar regain a foothold in the market, following almost a full week of declines against the Pound. Augusts’ house price index figures will also cross the wires; with the expectation to see a decline overall; which while negative is likely to be overshadowed by the consumer confidence figure.

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

Foreign Exchange Daily Market Update 24/10/11

The Pound closed out last week higher against both the Euro and the US Dollar in the foreign exchange market. The GBP/EUR exchange rate picked up across the course of the week, from Monday’s open at 1.1384 to trade up at 1.1489 by the close of the UK business day on Friday. The GBP/USD exchange rate also followed a similar pattern, with the rate opening on Monday at 1.5814, and closing on Friday up at 1.5942. This was despite a worrying inflation outlook from the UK, with the latest CPI figures released showing that the annual rate of price-growth rose to 5.2% from 4.9%, way above the Bank of England’s 2.0% target. The main market focus for the UK though was on the release of the Bank of England’s minutes from its last policy meeting; with the minutes showing that policy-makers voted unanimously (9-0) to inject a further £75billion into the economy over the coming months, and also discussed the possibility of the amount being as much as £100billion. The central bank was also united in its decision to keep interest rates at a record-low of 0.5%, despite inflation being at record levels; the latest figures showing price-growth standing at 5.2%. Governor Mervyn King warned that Britain was in the grip of the world’s worst ever financial crisis, and that the British economy would stall without the combination of further quantitative easing and ‘ultra-low’ interest rates. Despite UK government cutbacks, public sector net borrowing figures for September released last week showed an increase, from the previous month’s level of £10.9billion to £11.4billion. Public finance figures also showed an increase in the amount of money financed to the UK government, from £11.8billion to £19.9billion.

The week ahead will be much lighter in terms of economic data for the UK. Tuesday will see the release of the latest BBA loans for house purchase figures, with the market forecast for an increase in the figure for September. Friday morning could well see the main data release of the day affect the Pound’s standing in the market, with the release of GfK consumer confidence numbers for October released in the early hours. The market expectation is for no change in the index, but with increasing inflation, and a worsening jobs market in the UK, there is potential for a downturn in the figure.

The Euro finished last week lower against the Pound and the US Dollar in the currency exchange market. The currency has been coming under fierce pressure as EU leaders are still trying to reach a solution for the debt issues across the region, with a number of market participants seeing potential ongoing problems for the Euro-zone even if a solution is agreed upon; with European banks needing to strengthen their balance sheets, and the possible involvement of the ECB being brought into question. The EUR/USD exchange rate fell across the course of the week, from Monday’s open at 1.3890, down to 1.3659 by the close of the UK business day on Friday. Economic data released form Europe last week was pretty negative, with Euro-zone consumer confidence falling once again for October; down to -19.9 from -19.1, and also ZEW economic sentiment figures showing a decline from -43.3 to -48.3 for the same period.

This week will see some high-level market events, with Tuesday’s release of German GfK consumer confidence numbers, as well as Thursday’s German CPI (inflation) figures, and the latest Euro-zone business climate survey. The main market focus though is more than likely to be Wednesday’s market events, which will see the ECB release the results of a bank lending survey, and will also see EU leaders meeting at a debt summit, to try and come to agreement on an ongoing plan top try and restore some market credibility and financial stability to the region. The Euro could face even more pressure if there is no sign of a positive progression from this summit, with the market primed to punish any lack of tangible solution.

The US Dollar certainly benefitted from the debt woes in Europe last week by gaining against the single-currency across the week. The US Dollar however lost ground against the Pound, trading nearly a cent and a half lower against the Pound from Monday through to Friday. Data released from the US was fairly mixed, with CPI (inflation) rising annually in September, from 3.8% to 3.9%. Producer prices though held firm at 2.5% for September. The release of the Federal Reserve’s beige book economic survey showed a mixed outlook for the nation; with overall economic activity continuing to grow in September, albeit slowly, but with businesses expecting this to be ‘modest’ over the coming months.

There will be plenty of economic data crossing the wires form the US this week. Tuesday will see headline US consumer confidence figures released, with the market forecast to see an increase in positivity. Wednesday will see the release of durable goods orders figures for September; which are expected to show a sharp downturn. Thursday will be data-heavy for the US with 3rd quarter GDP figures, pending home sales and personal consumption numbers crossing the wires. The week will round off with Friday’s release of personal income and spending figures along with October’s University of Michigan confidence index, which is projected to show an increase for the month.

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

Foreign Exchange Daily Market Update 20/10/11

The Pound closed out yesterday higher against both the Euro and the US Dollar in the foreign exchange market. The GBP/EUR exchange rate finished the day at 1.1465, up from the morning’s open at 1.1407, with the GBP/USD exchange rate also closing higher, up from the morning’s open at 1.5756 to 1.5803 by the close of the UK business day. The main market focus for the UK yesterday was on the release of the Bank of England’s minutes from its last policy meeting; with the minutes showing that policy-makers voted unanimously (9-0) to inject a further £75billion into the economy over the coming months, and also discussed the possibility of the amount being as much as £100billion. The central bank was also united in its decision to keep interest rates at a record-low of 0.5%, despite inflation being at record levels; the latest figures showing price-growth standing at 5.2%. Governor Mervyn King warned that Britain was in the grip of the world’s worst ever financial crisis, and that the British economy would stall without the combination of further quantitative easing and ‘ultra-low’ interest rates.

This morning will see the release of September’s retail sales figures, with the market forecast for an increase in both the annual and monthly levels. This result would be positive for the Pound, as it would show that despite problems across Europe and a supposed lack of consumer confidence; that people are still spending, which is essential for any form of economic stability/growth.

The Euro fell against both the Pound and the US Dollar in the currency exchange market yesterday. The EUR/USD exchange rate fell from the morning’s open at 1.3812, to trade at 1.3780 by the market close, as news agencies worldwide reported on violent clashes between striking protestors and police in Greece. The country, which has, and is still employing deep austerity measures to ensure ongoing funding to prevent a default is seeing a 48 hour walkout by workers across the nation, in protest at the effect that searing government cuts are having on their wages, pensions, and quality of life. Ahead of crucial G20 talks this week, there is worry within the market that increasing the European Financial Stability Facility (EFSF) to help Greece could be misguided as it would create a circular problem; using a fund backed by Euro-zone countries to insure against default of the very same economies. It has been mooted that the ECB could increase its government bond buying activity, but there are worries that it would compromise its independence, and the fact that it is already carrying around €590billion worth of Portuguese, Irish, Italian, Greek and Spanish debt. With no clear solution easily viewable, the Euro could face firm pressure within the market over the coming days.

Today we have already seen the release of German PPI figures for September, which showed no change in the annual level of 5.5%, but an increase month-on-month from -0.3% to +0.3%. Later on today we will see the release of the German Economic Ministry’s GDP forecast, which will hopefully give some insight into the projected growth levels for one of the Euro-zone’s stronger nations; amid a current European debt situation which has the potential to send shockwaves across the globe. European consumer confidence numbers will cross the wires this afternoon, with the expectation to see yet another drop in the reading, which could add more pressure onto the European currency.

The US Dollar lost ground against the Pound, but took advantage of increased negative sentiment in the market towards Europe to gain against the single-currency (Euro) yesterday. There was also some positive news from the US, with housing starts for September showing an increase from the previous month, up to 658,000 from 572,000. CPI (inflation) figures showed a small increase in price-growth annually, from 3.8% to 3.9%, but inflation fell monthly, from 0.4% to 0.3%, which will ease some pressure on both US consumers and the Federal Reserve. The release of the Federal Reserve’s ‘beige-book’ economic survey showed a mixed outlook for the nation; with overall economic activity continuing to grow in September, albeit slowly, but with businesses expecting this to be ‘modest’ over the coming months.

The US economic docket for today will see the release of September’s existing home sales numbers, which are expected to see a downturn from the previous months reading of 5.03million to around 4.90million. The Philadelphia Fed Index will also report this afternoon, with the market forecast for an increase in positivity, but the figure to still remain at a negative level overall. The Dollar will be more likely to take direction from developing events across Europe today, as opposed to key data from home.

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

Foreign Exchange Daily Market Update 19/10/11

Yesterday the Pound experienced a choppy trading session against the Euro and the US Dollar. The GBP/EUR exchange rate opened the day at 1.1494 and held a narrow range for much of the morning, but by midday the foreign exchange market saw the pair steadily fall to hit a low of 1.1403. The GBP/USD exchange rate opened at 1.5757 and reached it's peak early into the day at 1.5785, but from then on the rate fell to its low of 1.5629. The Pound's decline seemed to coincide with the news that September's Consumer Price Index (CPI) rose by 5.2% annually exceeding forecasts for CPI to come in at 4.9%.

Today the Minutes to the Bank of England's (BoE) latest policy meeting will be in focus, with many traders looking to the minutes for indications as to whether the recent £75 billion increase in quantitative easing (QE) will be a one-off or if further stimulus may be on the cards. Any such mention of further QE could signal that the BoE is preparing itself for the possibility of a double-dip recession, and as a result the Pound could continue yesterday's decline.

The Euro managed to make gains against the Pound during yesterday's trading session, but against the US Dollar price action was quite volatile with the currency pair closing out slightly higher than when it opened. The currency exchange market saw the EUR/USD exchange rate open the European market at 1.3700 and then preceeded to make minor gains and then slip back with the pair hitting a low of 1.3652 by 15:00 GMT, but managed to climb back and close the day out at 1.3725. A worse than expected result for Germany's ZEW survey on Economic Sentiment for October aided in volatility of the single currency, with the survey producing a figure of -48.3 versus the forecasted outcome of -45.

Today the European economic docket lacks significant data releases, meaning the Euro will be subject to wider implications of risk aversion and news from other major economies.

The US Dollar managed to make gains against the Pound during yesterday's European session but failed to maintain the moment throughout the North American market session and the currency pair retraced earlier loses, while price action remained choppy against the Euro but by the open of the American market saw the Euro strengthen. On the data front, the annualised Producer Price Index (PPI) for September rose from 6.5% to 6.9%, while the core index which excludes food and fuel prices held at 2.5% compared to this time last year.

Meanwhile, Federal Reserve Chairman Ben Bernake delivered the keynote speech at the Boston Fed's 56th annual conference where he stated that the financial crisis of 2008 has "reminded us that the responsibility of central banks to protect financial stability is at least as important as the responsibility to use monetary policy effectively in the pursuit of macroeconomic objectives." However Bernanke failed to comment on the health of the US economy, but fellow Federal Open Market Committee members have stated that the Fed has done all it can to provide support for the US economy and that further accomadation could cause runaway inflation.

Looking ahead, the US will see the release of September's CPI reading with forecasts calling for inflation to reach 3.8% annually and the core index to rise from 2.0% to 2.1%. Building permit and housing start figures for September will also make an appearance with forecasts calling for increases in both figures, a result which could bolster the US Dollar.


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

Foreign Exchange Daily Market Update 18/10/11

The Pound finished yesterday’s trading session lower against the US Dollar but managed to regain some lost ground against the Euro. The foreign exchange market saw the GBP/EUR exchange pick up form an early morning low of 1.1365 and advance to a high of 1.1473 near the close of the European market. The GBP/USD exchange rate move in exact opposition with the currency pair peaking at high of 1.5847 at the session’s open, then falling sharply to the day’s low of 1.5733 before recovering to levels of around 1.5770. Yesterday’s docket was devoid of UK economic figures meaning the Pound’s strength was subject to events in the wider world.

This morning the UK has seen its Consumer Price Index (CPI) for September come in above expectations with the month-on-month reading rising to 0.6% instead of 0.4% as predicted. The year-on-year reading also rose above the consensus of 4.9% to 5.2%. The immediate market reaction was for a drop in the GBP/USD exchange rate from 1.5772 to 1.5741, the GBP/EUR rate fell from 1.15 to 1.1485. However given that the Bank of England has initiated another round monetary stimulus, the rise in inflation is unlikely to spur the central bank into raising the interest rate meaning this initial reaction will probably be short lived.

The Euro weakend against both the Pound and the US Dollar over the course of yesterday’s trading session. The single currency was not helped by news that both German Chancellor Angela Merkel and the country’s Finance Minister Schaeuble could not see a solution to the European debt problem being revealed by the weekend. This meant that EUR/USD exchange rate slipped from an early high of 1.3914 down to 1.3740 before the close of the market.

On the docket today, the currency exchange market will see the release of Germany’s ZEW survey on economic sentiment for the month of October. Forecasts call for the sentiment index to worsen from September’s reading of -43.3 to -45. Should the survey results fall in-line with the market concensus, then the Euro will most likely continue its downward journey against the other major currencies, as the economic outlook for Europe’s biggest eocnomic contributor worsens.

The US Dollar gathered strength against both the Euro and the British Pound through yesterday’s markets. News of Europe’s struggle to solve its debt crisis aided the Dollar’s advance, but domestic news also provided the currency with an opportunity to strengthen when September’s industrial production figures came in-line with expectations at 0.2%.

Looking forward to today’s economic calendar, September’s Producer Price Index (PPI) is scheduled for release with expectations calling for the core PPI to slow from to 2.5% to 2.4% annual growth, while the total PPI follows suit by slowing to 6.45 form 6.5%. Elsewhere Federal Reserve Chairman Ben Bernanke will be speaking in Boston this afternoon. The Chairman’s words may sway the market should he speak of confidence in the US economy, which will result in an appreciation in the Dollar, whereas should he speak of weakness in the US economy then the reverse could be true.

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

Foreign Exchange Daily Market Update 17/10/11

The Pound finished last week lower against the Euro; but much higher against the US Dollar in the foreign exchange market. The GBP/EUR exchange rate closed out the week at 1.1410, well down from the week’s open at 1.1544. The GBP/USD exchange rate however, picked up across the course of the week; from Monday’s open at 1.5620, to trade up at 1.5799 by the close of the UK business day on Friday. Overall, the economic news released from the UK last week was negative, with industrial production and manufacturing production both falling annually. The UK’s labour market saw signs of further negativity; with the claimant count rate increasing from 4.9% to 5.0%, and the ILO unemployment rate also rising; from 7.9% to 8.1%, the highest level since 1996. The UK’s trade balance did decrease slightly, the trade deficit narrowed slightly in August, from -£8,156 million to -£7,768 million, but still shows the UK’s heavy over-reliance on imported goods, and minimal export activity.

The main focus of the week ahead is probably the release of the Bank of England’s minutes from its last policy meeting on Wednesday. With the central bank adding an extra £75billion to its asset purchasing programme, it will be important to see the voting majorities in terms of the additional stimulus; and also the maintaining of the current base interest rate. The minutes should also give some insight into the overall stance from the Bank of England in regards to future policy, and also expectations for both economic and price-growth over the coming months. Aside from that, we will see the release of CPI (inflation) figures for September on Tuesday, with the expectation for the annual inflation to rate to have reached nearly 5.0%, which would be a hug concern for the central bank; with some market participants mooting a possible rate-cut in the UK to combat burgeoning price-growth. Thursday will see the latest retail sales figures cross the wires, and then on Friday we will see the release of the latest Nationwide consumer confidence figures, along with public finance numbers for September.

The Euro closed out last week having gained against both the Pound and the US Dollar in the currency exchange market. The EUR/USD exchange rate moved up considerably across the week; from Monday’s open at 1.3531, to trade up at 1.3844 by the UK market close on Friday. Economic data released from the Euro-zone was mostly positive; with Euro-zone industrial production showing good gains, both annually and month-on-month. German trade balance figures showed an increase in the nation’s trade surplus, a positive sign of its huge export market, the level increasing from €10.5billion to €11.8billion. There was a small worry with Euro-zone CPI figures, which showed a pick up in inflation annually from 2.5% to 3.0%, and monthly from 0.2% to 0.8%, which will worry the European central Bank slightly, as they seek to combat high inflation. The main focus was on the ECB’s monthly report though, which was in no way positive for the Euro-zone. The report stated that growth in the Euro region would remain ‘moderate’ for the rest of the year, that there are ‘increasing downside risks’ and also that inflation will remain ‘clearly above 2.0%’ for the time being.

This week will again contain plenty of high-level market data from Europe. Tuesday will see the release of German and Euro-zone ZEW economic sentiment figures for October, which could put pressure on the currency if they report lower; which is highly likely. Thursday will be a data-heavy day, with German producer prices, Euro-zone consumer confidence, and German economic ministry GDP forecasts all crossing the wires. The week will round off on Friday with the release of German IFO figures for business climate, current assessment, and expectations, and also Euro-zone government debt to GDP ratio figures for 2010. The currency could be affected by these, with the level set to report at around 85.1%, and could well push higher throughout this year.

The US Dollar fell against both the Pound and the Euro last week, and the currency was definitely not helped by very dovish commentary from the Federal Reserve. Minutes released from the Federal Reserve’s last policy meeting, showed that 2 policy-makers voted for extra monetary stimulus as they felt that the weak economy justified the addition of more funding. The minutes also showed that 3 policy-makers voted against the shifting of $400 billion towards extending the maturity date of the central bank’s security holdings, the largest dissenting majority seen by an FOMC voting board in over 20 years. In terms of growth, the minutes stated that the Fed sees a ‘bleak economic outlook’ and there are ‘significant downside risks’ to future growth. There was some positivity in advance retail sales numbers for September, which showed a pick-up from 0.3% to 1.1%. The week closed out on a dour not though, with the University of Michigan confidence survey showing a downturn in October; from 59.4 to 57.5, completely opposite to the market forecast.

The US economic docket is data-heavy this week, and will kick-off today with the release of industrial production figures for September. Tuesday will see the release of PPI figures, along with Net long-term TIC flows, and will also see Federal reserve Chairman Ben Bernanke speaking in Boston; with market experts poised for any commentary from the bank chief. CPI (inflation) figures for September will cross the wires on Wednesday, along with housing starts and the beige book economic survey. The week will round off on Thursday with the release of existing home sales numbers, which are poised for a slight rebound, and the Philadelphia Fed index which is expected to show a positive upturn.

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

Daily Foreign Exchange Market Update 13/10/11

The Pound finished the day almost unchanged against the Euro, but higher against the US Dollar in the foreign exchange market yesterday. The GBP/EUR exchange rate which opened at 1.1413, closed the day out at 1.1413; with the GBP/USD exchange rate picking up from 1.5623 at the morning’s open, to trade up at 1.5761 by the end of the UK business day. Economic data released from the UK yesterday was negative overall, and fully-focused on the labour market. Figures showed that the claimant count rate for September increased from 4.9% to 5.0%, and that the overall unemployment rate in the UK for the 3 months to August rose from 7.9% to 8.1%; the worst level seen in the UK since 1996.

This morning will see the release of the UK’s trade balance figure for August; which is expected to reinforce the UK’s huge trade deficit; as a result of the massive difference between the volumes of imported goods as compared to the volume of exported goods.

The Euro gained against the US Dollar yesterday, but finished about the same against the Pound in the currency exchange market. The EUR/USD exchange rate picked up across the day, from 1.3688 at the morning’s open, to trade up at 1.3809 by the market close. There was some unexpected positive data released form Europe, with Augusts’ Euro-zone industrial production figures showing an upturn in both the annual and monthly levels; from 4.4% to 5.3%, and from 1.1% to 1.2% respectively. This did help the Euro currency, as the stronger European member states such as Germany are reliant on industry for economic stability and growth.

Today has already seen the release of the ECB’s monthly report for October; which was in no way positive for the Euro-zone. The report stated that growth in the Euro region would remain ‘moderate’ for the rest of the year, that there are ‘increasing downside risks’ and also that inflation will remain ‘clearly above 2.0%’ for the time being.

The US Dollar fell against both the Euro and the Pound yesterday, and the currency was probably not helped by release of the minutes from the Federal Reserve’s last policy meeting, which showed that 2 policy-makers voted for extra monetary stimulus as they felt that the weak economy justified the addition of more funding. The minutes also showed that 3 policy-makers voted against the shifting of $400 billion towards extending the maturity date of the central bank’s security holdings, the largest dissent majority seen by an FOMC voting board in over 20 years. In terms of growth, the minutes stated that the Fed sees a ‘bleak economic outlook’ and there are ‘significant downside risks’ to future growth.

This afternoon will see the release of the latest trade balance numbers from the US. Like the UK, the US has a fairly large trade deficit; and the market forecast is for the latest reading to show a bigger increase in the gap between import and export activity.

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

Foreign Exchange Daily Market Update 12/10/11

The Pound fell lower against both the Euro and the US Dollar in the foreign exchange market yesterday following some fairly disappointing economic data, and an anticipation of further negative new today. The GBP/EUR exchange rate fell from the morning’s open at 1.1472 down to 1.1416 by the market close. The GBP/USD exchange rate also came lower across the day, dropping from 1.5644 in the morning, to trade at 1.5597 by the close of the UK business day. Figures released from the UK yesterday showed that manufacturing production fell both annually and monthly, from 2.6% to 1.5% and from 0.2% to -0.3% respectively. Industrial production also dropped annually; from -0.9% to -1.0%, but there was a slight increase month-on-month from -0.4% to +0.2%. The latest NIESR GDP estimate for September did little to inspire any confidence in the currency despite a reading of 0.5%, up from the previous reading at 0.2%.

Today will focus solely on the UK’s labour market, with the expectation to see an increase in both the jobless claims number and claimant count rate for August; which could see the Pound lose further ground. More worrying though is the market forecast for an increase in the ILO unemployment rate for the 3 months to August, from 7.9% to 8.0%. With the prospect of further government cutbacks to come in the UK, a weakening jobs market could hinder any prospects of an increase in overall economic growth over the coming months.

The Euro gained against the Pound, and also advanced slightly against the US Dollar in the currency exchange market yesterday. The EUR/USD exchange rate finished the day trading at 1.3658, a slight improvement on the morning’s open at 1.3636. There was no significant economic data released from Europe yesterday, which may account for the fairly narrow trading range against the Dollar. There was some positive news for Greece though; with an agreement reached which will see the debt-stricken nation receive a further round of funding to try and enable it to find its feet once again.

Today will see the release of Augusts’ Euro-zone industrial production figures, with the expectation for a drop in both the annual and monthly level, which could see the Euro trade slightly lower, as the stronger nations within Europe such as Germany, do rely heavily on their industrial sector.

The US Dollar advanced against the Pound, but came slightly lower against the Euro yesterday. With no economic data of note released form the US yesterday; the slight drop against the Euro could be attributed to a small increase in market confidence towards Europe with Greece receiving access to further refunding, and the gain against the Pound due to poor economic data released from the UK.

The Dollar could well take direction from the release of the minutes from the Federal Reserve’s last policy meeting later on today. The minutes should show the central bank’s reasoning behind diverting $400 billion to extending the maturity date of the securities it holds, and also should give some insight into the FOMC’s view in regards to economic growth and inflation over the coming months.

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

Foreign Exchange Daily Market Update 11/10/11

The Pound finished yesterday lower against the Euro; but higher against the US Dollar in the foreign exchange market. The GBP/EUR exchange rate fell across the day, from 1.1544 at the morning’s open down to 1.1459 by the day’s close. The GBP/USD exchange rate however, picked up from 1.5620 at the market open to trade up at 1.5682 by the close of the UK business day. There were no significant releases in terms of economic data from the UK yesterday, with market movement being based on shifts in risk sentiment, and also news from the worlds other major economies.

The early hours of this morning has seen the release of September’s RICS house price balance figure, which held steady at -23%. Later on today will see Augusts’ industrial and manufacturing production figures cross the wires, with the market forecast for a slight drop in both readings; which is not a positive sign for the overall UK economy, but should not affect the currency too heavily. This afternoon’s release of the latest GDP estimate from the NIESR may affect the Pound. With the market expecting a reading of around 0.2% for September, any downward revision to this could see the Pound come under fierce pressure.

The Euro gained against both the Pound and the US Dollar in the currency exchange market yesterday. The EUR/USD exchange rate moved up throughout the day, from the morning’s open at 1.3531 to trade up at 1.3684 by the day’s close. This was despite disappointing Euro-zone Sentix investor confidence figures for October, which showed an increase in negative sentiment, the reading dropping from -15.4 down to -18.5.

There are no scheduled data events of note for Europe today, leaving the currency open to data from the UK and the US, and any potential developments in regards to Euro-zone debt and re-financing.

The US Dollar lost ground against the Pound and the Euro yesterday. There was no economic data released from the US due to it being a non-trading day (Columbus Day).

Today will see the release of the minutes from the Federal Reserve’s last policy meeting on the 20th September. The market will look to gain some sense of direction and overall sentiment from the central bank in terms of future policy, and also the prospects for economic growth and inflation. The Dollar could take direction from this release, with market participants eager to understand the Federal Reserve’s thinking behind adding an additional $400 billion to extend the maturity dates of all it’s security holdings, and also how the central bank plans to combat a weak housing and labour market.

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

Foreign Exchange Daily Market Update 06/10/11

The Pound finished a touch lower against the Euro, but slightly higher against the US Dollar in the foreign exchange market yesterday. The GBP/EUR exchange rate did pick up early on from the morning’s open at 1.1597, breaking through 1.1600 only to fall back to 1.1589 by the end of the UK business day. The GBP/USD exchange rate finished the day at 1.5434, up from the morning’s open at 1.5421. Despite positive PMI services figures for September, which saw the index reading pick up to 52.9 from 51.1; the overall feeling from the UK was negative, with the release of the final reading of 2nd quarter GDP figures. The final reading showed the quarterly growth rate as 0.1%, down from 0.2%, and the annual growth rate revised down to 0.6%; lower than the previous reading at 0.7% This is not positive news for the UK economy, but may have some positive connotations as it will increase pressure on the Bank of England to add further monetary stimulus to try and increase growth prospects.

The main focus today for the UK will be on the Bank of England’s policy meeting. Despite the market forecast being for no change in either the interest rate or asset purchasing target; there is increasing pressure on the central bank to add some further stimulus, particularly after yesterday’s GDP figures. It may well be though, that the currency will take better direction from the minutes release on Wednesday, 2 weeks after today’s decision; as the minutes from the meeting will give insight into the voting majorities, and the Monetary Policy Committee’s current stance towards growth and inflation.

The Euro ended the day slightly higher against the Pound, and also against the US Dollar in the currency exchange market. The EUR/USD exchange rate moved up slightly throughout the day, from the morning’s open at 1.3296, to trade at 1.3317 by the day’s close. All the economic data released from Europe yesterday however was negative, with German and Euro-zone PMI services figures for September all reporting declines, as well as a downturn in the composite figure fro Euro-zone PMI. The negative feeling was compounded with very disappointing Euro-zone retail sales figures, showing a drop annually from -0.4 to -0.1%, and month-on-month from +0.2% to -0.3%.

Today will see the release of German factory orders for August, with the market expectation for a sharp decline in the annual level, but a marked improvement in the monthly figure. However, the main focus is most certainly the European Central Bank’s rate decision; with many market experts having conflicting expectations in terms of what decision will be reached. The majority of analysts are forecasting no change in the base interest rate; but with the overnight-index swaps market pricing in rate cuts before the end of the year, and also many banks and countries hoping for a reduction in borrowing costs, there may well be a surprise cut.

The US Dollar did fall slightly against the Euro and the Pound yesterday; but there was some buoyant news released from the US. September’s ADP employment change figures showed that 91,000 jobs were added throughout the month, up from the previous month’s level of 89,000 – which was a huge increase amid market forecast for a sharp decline in the reading.

There are no scheduled economic figures of note for the US today, and with two big potential risk-events in the UK and Europe, the currency could well see some choppy trading.

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

Foreign Exchange Daily Market Update 05/10/11

The Pound fell against the Euro; but ended yesterday almost unchanged against the US Dollar in the foreign exchange market. The GBP/EUR exchange rate fell across the day from the mornings open at 1.1711, down to 1.1577 by the end of the UK business day. The GBP/USD exchange rate however, closed at 1.5411, almost exactly at the market open rate of 1.5409, following a day of choppy trading. The sole piece of economic data released from the UK yesterday saw PMI construction figures for September report a drop; from 52.6 down to 50.1.

This morning has seen the release of PMI services figures for September which saw a positive gain; from 51.1 to 52.9, but more importantly was the release of the final reading of 2nd quarter GDP for the UK. The result was a downward revision, with the quarterly growth rate at 0.1%, down from 0.2%, and the annual growth rate falling from the previous reading at 0.7% down to 0.6%. This is not positive news for the UK economy, but may have some positive connotations as it will increase pressure on the Bank of England to add further monetary stimulus to try an increase growth prospects.

The Euro gained against both the Pound and the US Dollar in the currency exchange market yesterday. The EUR/USD exchange rate moved up across the course of the day from 1.3157 at the mornings open, to trade at 1.3311 by the day’s close. The European economic docket yesterday focused on euro-zone producer prices, with the PPI index showing a drop in prices, annually from 6.15 to 5.89%, and month-on-month from 0.5% to -0.1%. This may be positive for Europe, as lower producer prices may indicate lower costs passed on to consumers, which may go some way to keep inflation subdued.

Today has already seen German and Euro-zone PMI figures report lower for September, but the figures seem to have had little effect on the market. Later on this morning, Euro-zone retail sales for August will cross the wires, with the market forecast for a drop in both the annual and monthly levels, which could put pressure on the Euro; as lower retail sales is an indicator of slowing economic growth and lower consumer spending.

The US Dollar ended almost unchanged against the pound yesterday, but lost ground against the Euro. The currency was not helped by disappointing factory orders figures for August, which showed a sharp drop from 2.1% down to -0.2%. This figure was overshadowed by Federal Reserve Chairman Ben Bernanke’s appearance in front of the joint economic committee, during which he stated that The Federal Reserve is prepared to take further steps to help an economy that is "close to faltering," Fed chairman Ben Bernanke said on Tuesday in his bleakest assessment yet of the fragile U.S. recovery. Citing anaemic employment, depressed confidence, and financial risks from Europe, Bernanke urged lawmakers not to cut spending too quickly in the short term even as they grapple with trimming the long-run budget deficit. Bernanke said "The Committee will continue to closely monitor economic developments and is prepared to take further action as appropriate to promote a stronger economic recovery in the context of price stability,".

Today will see the release of Septembers’ ADP employment change figures, which are expected to show less jobs added than the previous month, and also the latest ISM non-manufacturing numbers for September; with the market forecast for a decrease in the index level; which would not be positive for the Dollar.

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

Foreign Exchange Daily Market Update 04/10/11

The Pound made a small gain against the Euro; but fell against the US dollar in the foreign exchange market yesterday. The GBP/EUR exchange rate picked up from the morning’s open at 1.1639 to trade at 1.1657 by the day’s close. There was further upward movement after the end of the UK business day, with the rate moving up towards 1.1700 territory. The GBP/USD exchange rate however fell across Monday, from 1.5544 at the day’s open, down to 1.5474 by the market close. The sole piece of economic data released from the UK yesterday showed that PMI manufacturing increased in September, up to 51.1 from the previous month’s level of 49.4.

This morning will see the release of September’s PMI construction figure, with the market forecast for a slight drop in the index; but with yesterday’s manufacturing figure coming in above analysts’ estimates; the pound could benefit slightly from another improved figure.

The Euro lost ground against both the Pound and the US Dollar in the currency exchange market yesterday. The EUR/USD exchange rate slipped from the morning’s open at 1.3355, to trade at 1.3274 by the end of the UK business day, and continued to drop overnight. There was positive news in terms of economic data from Europe yesterday, with German and Euro-zone PMI manufacturing figures both increasing in September, from 50.0 to 50.3 and from 48.4 to 48.5 respectively; but the currency is coming under huge pressure due to the ongoing Greek debt crisis. Greece has already missed its deficit target for 2012, and European officials are still yet to agree terms for Finland’s demand for extra collateral to underpin bailout loans, which would go some way to finding resolution to ensure Greece receives its sixth bailout payment. The knock-on effect of a default is what has the market spooked, and it is being mooted that the ECB will have to become actively involved in security and bond buying to try and protect European banks from any damaging effects.

Today will see the release of Euro-zone PPI figures for August, with the expectation for a drop in both the annual and monthly levels, which would not be positive news for the currency, and could, heap further pressure onto the Euro; which has fallen rapidly across the market in the last 24 hours.

The US Dollar once again has returned to form, and benefits from its ‘safe-haven’ status with the increased woes across Europe. As the market is starting to expect some from of European recession, the Dollar gained across the board; and this could well be attributed to a shift in risk sentiment towards the currency. As well as the Euro-zone and the UK reporting manufacturing figures yesterday, the US released September’s ISM manufacturing figures, which showed a positive gain, from 50.6 to 51.6.

The US will release Augusts’ factory orders figures later today; and despite a good gain in yesterday’s manufacturing index, the market forecast is for a rapid drop in factory orders. Even if this is the case, the figure is likely to be overshadowed by Federal Reserve Chairman Ben Bernanke’s appearance in front of the joint Economic Committee today. Chairman Bernanke will be grilled on the ‘economic outlook’ for the US, and is likely to face questions on growth prospects, ‘Operation Twist’ and the US’s bank exposure to Europe; with the currency primed to take direction from the Chairman’s comments.

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

Foreign Exchange Daily Market Update 03/10/11

The Pound ended last week higher against the Euro in the foreign exchange market; and also reversed some of the previous week’s losses against the US Dollar. The GBP/EUR exchange rate moved up throughout the week, from Monday’s open at 1.1506 to trade at 1.1623 by the close of the UK business day on Friday. The GBP/USD exchange rate followed a similar patter, advancing from 1.5451 at the open on Monday, hitting a high of 1.5713 on Thursday before falling slightly to end the week at 1.5637 by Friday’s close. There was not much in terms of economic data from the UK last week, with the highlights being a drop in CBI reported sales for September, from -14 to -15; Augusts’ mortgage approvals showing a good gain from 49,600 to 52,400, and net consumer credit increasing from 0.3 billion pounds to 0.5 billion pounds.

The week ahead is also fairly light in terms of data releases; but does contain some high-level figures. September’s PMI figures for manufacturing, construction, and services will be released on Monday, Tuesday, and Wednesday respectively. Wednesday will also see the release of the final reading of 2nd quarter Gross Domestic Product (GDP) from the UK. The market expectation is for the quarterly growth rate to remain at 0.2%, and annually at 0.7%; which is not hugely impressive, but it will be crucial for the figure to not see any downward revisions to help the Pound maintain its position within the market. Thursday will see the Bank of England announce this month’s interest rate and asset purchase target, with the market forecast for no change in either level. More key will be the minutes release on Wednesday, 2 weeks after the rate decision; which will give insight into the voting majorities, and the current stance towards growth and inflation from the central bank. The week will close out on Friday with September’s PPI figures, which are expected to show little change, and shouldn’t have too much effect on the market.

The Euro fell against both the Pound and the US Dollar last week in the currency exchange market. The EUR/USD exchange rate fell from Monday’s open at 1.3516, to trade at 1.3452 by Friday’s close; despite hitting a high of 1.3689 on Wednesday. Economic data released form Europe last week did little to inject positive sentiment towards the currency, with Septembers German IFO figures for business climate, current assessment and expectations all coming lower. October’s German GfK consumer confidence survey showed no change, with the figure holding at 5.2. There was some more positive news on Thursday, with the German unemployment rate falling from 7.0% to 6.9%, and the unemployment change figures showing a reduction from -9,000 to -26,000 claims. Any increased positivity though was countered with a host of negative data in terms of Euro-zone consumer, industrial, services and economic confidence indices, which all reported drops for September. The European Central Bank (ECB) may also face additional pressure, with Friday’s release of September’s Euro-zone CPI (inflation) figure showing a predicated increase in price growth from 2.5% to 3.0%.

Like the UK, the early week figures from Europe will focus on PMI, with German and Euro-zone manufacturing index figures set for release on Monday, then German and Euro-zone PMI services and the Euro-zone composite figure being released on Wednesday. Sandwiched in between these release on Tuesday will be Euro-zone PPI figures for August, with the market forecast for drops in both the annual and monthly level; which could benefit the Euro as lower producer prices usually translate to lower retail prices, which will ease pressure on cash-strapped consumers throughout the Euro-zone. Thursday’s German factory order figures will be somewhat over-shadowed by the ECB’s interest rate decision. The bank are under pressure to divert extra funds toward bond purchasing to prevent default and try to stimulate growth in some of the economically weak member nations, and with many analysts expecting a rate cut from the ECB before the end of the year; the post-decision press conference will be key for the market to gain a sense of the direction the central bank is considering taking over the coming months. The week will round off with Friday’s release of German industrial production figures for August. With Germany relying heavily on its manufacturing industry for economic growth; any sharp declines in this figure could prove problematic for the Euro.

The US Dollar lost ground against the Pound, but did advance slightly against the Euro across the course of last week. The Dollar had been benefitting in past weeks from its safe-haven status, and with increased turmoil in Europe it had been gaining rapidly across the board. This was reversed across the past week, particularly against the Pound. The US economic docket produced a fairly mixed picture; with the Chicago Fed national activity index declining, from 0.06 to 0.43, but with US consumer confidence for September showing a slight increase from 45.2 to 45.4. Durable goods orders numbers fell heavily, from 4.1% to -0.1% for August, but the 2nd quarter GDP figures showed an increase in economic growth. The annual rate rose from 1.0% to 1.3%, with personal consumption also increasing from 0.4% to 0.7%. The week rounded off on a positive note; with Septembers University of Michigan confidence index showing a good gain, from 57.8 to 59.4, which did see the Dollar make appositive move in the market.

This week is fairly data heavy for the US. Monday will see ISM manufacturing and construction spending figures for September cross the wires. Tuesday will see Augusts’ factory orders numbers released, along with the main data event of the week; Federal Reserve Chairman Ben Bernanke testifying in front of the Joint Economic Committee. Wednesday see the release of September’s ADP employment change figures, along with ISM non-manufacturing figures, and the week will round off on Friday with Augusts’ consumer credit numbers, employment rate figures, and the potentially market-moving non-farm payroll figures. No-farm payroll numbers are renowned for being notoriously hard to predict accurately, hence upon release the market could well see sharp movement against the US Dollar.

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