Foreign Exchange Daily Market Update 07/03/12

The Pound gained against the US Dollar but declined against the Euro in the foreign exchange market yesterday. The GBP/EUR exchange rate picked up from 1.1981 at the morning’s open to trade in a range of 1.1955 and 1.1990, before trading back to 1.1973 by the close of the UK business day. The GBP/USD exchange rate picked up from 1.5733 to trade down to the day’s low of 1.5696 before trading back to 1.5744 by the European market close. The Pound also finished lower against the New Zealand Dollar and against the Australian Dollar in the foreign exchange market. The GBP/NZD exchange rate picked up from 1.9257 at the morning’s open to trade down towards 1.9204 by the close of the UK business day. The GBP/AUD exchange rate opened up from 1.4902 and finished the session lower at 1.4876.

There was no significant data from the UK yesterday, however today at 12:00 GMT we will be keeping a close eye on the BOE Asset Purchase Target for the month of March and BOE Rate decision, which is expected to be unchanged at 0.50% by economists.

The Euro gained against the Pound and against the US Dollar in the currency exchange market yesterday. The EUR/USD exchange opened up at 1.3129 to trade down to the day low of 1.3096 before closing out at 1.3148 by the European market close. Yesterday we had the German Factory Orders n.s.a. (Jan) year-on-year, come in worse than expected at -4.9% vs. -1.7%.

This morning we have seen the release of the French Trade Balance (Jan) which has come in worse than expected at €-5324m vs. €-5150m, along with French Bank of France Business Sentiment (Feb) also coming in worse than expected at 95 vs. 96.

Today we will look out for the 11:00 GMT German Industrial Production n.s.a. expected to increase from 0.90% to 1.1% for the year-on-year figure and a increase from -2.9% to 1.1% for the month-on-month figure.

The US Dollar declined against the Pound and against the Euro currencies yesterday. Overall their was positive data released from the US yesterday, with ADP Employment Change increasing from 173k to 216k this month, slightly higher than the expected 215k. However MBA Mortgage Applications (Mar 2) came in lower compared to the prior month falling from -0.3% to -1.2%, But had positive US Consumer Credit after trading session hours, with Consumer Credit increasing from $16.268bln to $17.776bln for the month of January.

Today from the US we will keep a close eye on the RBC Consumer Outlook, Intial Jobless Claims and Continuing Claims. Although the main focus will be tomorrow’s US Non Farm Payrolls Data.

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