Foreign Exchange Market Update 24/04/2012

The Pound gained against the US Dollar and gained against the Euro yesterday in the foreign exchange market. The GBP/EUR exchange rate picked up from 1.2234 at the morning’s open to trade in an uptrend towards the day high of 1.2270, before trading back around 1.2262 by the close of theUK business day. The GBP/USD exchange rate picked up from 1.6083 to trade in a Range between 1.6074 and 1.6115, before trading up around 1.6099 by the European market close. The Pound also maintained its strength against both the Australian Dollar and the New Zealand Dollar in the foreign exchange market yesterday. The GBP/NZD exchange rate picked up from 1.9787 at the morning’s open to trade up towards 1.9840 by the close of the UK business day. The GBP/AUD exchange rate opened up from 1.5589 and finished the session higher at 1.5633.

Yesterday we had no economic data scheduled from the UK. However today we have the release of Public Finances (Mar) and Public Sector Net Borrowing (Mar) due at 09:30 GMT. Economists are expecting an increase in both figures, with Public Finances expected to increase from -£7.8bln to £13.0bln and Public Sector Net Borrowing expected to increase from £12.9bln to £14.2bln.

The Euro declined against the US dollar and against the Pound in the currency exchange market yesterday. The EUR/USD exchange opened up at 1.3145 and traded towards the low of 1.3104, before trading back 1.3128 by the European market close.

Yesterday economic data from the Euro-zone was fairly negative with the French Business Confidence Indicator (Apr) missing expectation, coming in at 95 vs. 96 and down from the prior month of 98. Both French Purchasing Manager Index for Manufacturing and Services missed expectations, with the Manufacturing coming in at 47.3 vs. 47.4 and Services 46.4 vs. 50.1. German Purchasing Manager Index was mixed with the Manufacturing missing expectations coming in at 46.3 vs. 49 and Services gained slightly coming in at 52.6 vs. 52.3 and up from the prior month of 52.1. Also Italian Consumer Confidence declined coming in at 89.0 down from the prior month of 96.3 and finally the Euro-zone PMI declined to 47.4 vs. 49.1 from the prior month.

This morning from the Euro-zone we have seen an increase in French Consumer Confidence Indicator (Apr) coming in at 88 up from the prior moth of 87. Also Italian Wages month-on-month was left unchanged at 0.0%, however the year-on-year figure declined from 1.4% to 1.2%.

Later this morning we will look out for the Euro-zone Release of Industrial Orders due at 10:00 GMT.

The US Dollar declined against the Pound, but managed to gain against the Euro currencies yesterday. There was no scheduled economic data from the US Yesterday, however today we will look out for the Consumer Confidence due at 15:00 GMT where economists are expecting a decline from 70.2 to 69.5. Also due at 15:00 GMT today we have the release of New Home Sales (Mar) which is expected to increase from 313k from the prior month to 320k and Richmond Fed Manufacturing Index (Apr) which is expected to decline from 7 to 6.

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