Foreign Exchange Daily Market Update 23/03/12

The Pound declined against the US Dollar again yesterday and also against the Euro in the foreign exchange market. The GBP/EUR exchange rate picked up from 1.2039 at the morning’s open to trade in an downtrend towards the day low of 1.1976, before trading back to 1.1986 by the close of the UK business day. The GBP/USD exchange rate picked up from 1.5851 the high of the day to trade down to the day’s low of 1.5770 before trading back towards 1.5812 by the European market close. The Pound also declined against the Australian Dollar and the New Zealand Dollar in the foreign exchange market yesterday. The GBP/NZD exchange rate picked up from 1.9614 at the morning’s open to trade down towards 1.9533 by the close of the UK business day. The GBP/AUD exchange rate opened up from 1.5267 and finished the session lower at 1.5219.

Yesterday we had the UK Retail sales came in much lower than expected putting pressure on GBP/USD currency pair. Retail Sales (Feb) year-on-year came in at 1.0% vs. 2.3% expected by economists and was down from prior release of 1.1

Today we will look out for the UK BBA Loans for House Purchase (Feb) due at 09:30 GMT, where economists are expecting a decrease from 38092 to 37250.

The Euro gained against both the Pound the US Dollar in the currency exchange market yesterday. The EUR/USD exchange opened up at 1.3164 and traded in a open range of the day low at 1.3135 to the high of 1.3202, before trading back towards the 1.3190 level by the European market close.

Yesterday morning we had seen a decline in French Purchasing Manager Index coming in at 47.6 vs. 50 and German Purchasing Manager Index for Manufacturing (Mar) coming in at 48.1 vs. 51. Also we saw a slight decrease in the Euro-zone PMI Composite where economists were expecting increase from 49.3 to 49.6, but the figure came in 48.7. However the Euro-zone Consumer Confidence (Mar) showed a slight improvement coming in at -19.0 vs. -19.8 and up from -20.3 from the prior month.

This morning we had the release of the French Business Confidence Indicator (Mar) beating expectations of 93 coming in at 96. Also beating expectations was the Italian Retail Sales release for both month-on-month and year-on-year, with the monthly figure coming in at 0.7 vs. -0.1% up from the prior month of -0.8% and the yearly figure coming in at -0.8% vs. -3.4% up from -3.7% previously.

We have no further economic data from the Euro-zone today.

The US Dollar managed to gain against the Pound and but declined against the Euro currencies yesterday. Yesterday we had some fairly positive data from the US yesterday, with Initial and Continuing Claims coming in better than expected. Initial claims came in at 348k down from 353k from the prior week and Continuing Claims came in at 3352k down from 3361k. Also Leading Indicators (Feb) showed an improvement coming in at 0.7% from 0.2% previously.

Today from the US we have New home Sales Due at 14:00 GMT where economists expect an increase from 321k to 325k.

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