Good Start for Sterling Following US Figures
Currency Market Updates
9, November 2009
The pound is off to a flyer in particular against the USD
hitting 1.68 and pushing to 1.12 against the EUR. Some attention in the markets is focusing on the Kraft/Cadbury developments which is sterling supportive in relation to M & A flows. EUR/USD is also testing the 1.50 level again this morning; Euro zone investor confidence has come in much better than expected with the highest reading since June 2008. GBP/EUR struggling to gain further due to the EUR
strength against the USD
Over the weekend the G20 agreed a new framework aimed at re-balancing the global economy and will present detailed plans by the end of Jan. In the meantime the US dollar is weak and this is leading to a stronger euro and Yen; the IMF have also noted that the USD is still overvalued raising concerns that the USD could weaken further. Targets will be for the euros to hold above 1.50 and GBP/USD to push towards 1.70.
On Friday the non-farm payrolls for the US slipped by a worse than expected 190k and the unemployment level hit 10.2%. This was not good news for the US economy in the short term, although the market may still look forward to a slowly improving employment sector. It was not enough to turn the market into risk aversion and USD strength.
Report by Phil McHugh
Currencies Direct is a leading commercial foreign exchange company with offices in the UK, Australia and Spain and has offices across 5 continents. Currencies Direct’s head office and global trading centre is based in the City of London.
The contents of this report are for information purposes only. It is not intended as a recommendation to trade or a solicitation for funds. Currencies Direct cannot be held responsible for any loss or damages arising from any action taken following consideration of this information.
Compiled by Tom Nadir.
leave a comment