Daily Foreign Exchange Market Update

Yesterday in the foreign exchange market the Pound saw some gains against the Euro but a slight loss in strength against the US Dollar. The GBPEUR rate opened at 1.2519 before quickly dropping to a daily low of 1.2508 soon after the opening bell. It then gained some strength across the rest of the day and peaked just after lunch to 1.2561, closing the day out slightly lower at 1.2540. The GBPUSD rate opened the day at 1.5984, dropping mid-morning to a daily low of 1.5929 before gaining strength in the first hour of the afternoon, peaking to a daily high of 1.6005, closing the day out slightly lower at 1.5977. Yesterday the main news was that the Bank of England will keep the base rate at 0.5% and the asset purchase target at £375B, as expected by analysts as last month third quarter GDP came out at 1%. Today will be a quiet day with no data being released from the UK.

The Euro weakened against the US Dollar and the Pound during yesterday’s market session. The EURUSD rate opened at 1.2767, a daily high and lost ground during the first few hours of trading, dropping to 1.2719, closing slightly high at 1.2740. Like the UK the main data from the Euro-zone yesterday was the fact that the ECB decided to keep the main interest rate at 0.75%. Today will see various pieces of information being released, the main being German CPI (inflation) which is expected to remain at 2.0%, in line with previous results showing a steady rate of inflation in Germany.

The US Dollar gained some ground against the Pound and the Euro in the foreign exchange market yesterday. The most significant piece of data from the US yesterday were the unemployment claims which were better than expected, 355K compared to the predicted 367K showing a lower rate of people claiming unemployment insurance. Today will see the University of Michigan release their consumer sentiment results which assesses the confidence of consumers within the economy based on personal finance, business conditions and purchasing power. The figure is calculated by subtracting the percentage of unfavourable replies from the favourable ones and this month it is set to come out at 82.9, slightly higher then last months result of 82.6.

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