Wednesday 3rd August 2011
Good morning. We are at a 2 month high vs the Euro, as the single currency weakened further on due to renewed worries about euro zone debt and the risks of it spreading to countries like Spain and Italy. Despite its gains versus the euro, the pound slipped against the US Dollar, stronger now the debt bill has been passed. At 08:30am this morning rates are as follows:
• GBP/EUR 1.1450
• GBP/USD 1.6305
• GBP/AUD 1.5138
• GBP/NZD 1.8851
• GBP/CAD 1.5652
• GBP/ZAR 11.069
• GBP/JPY 125.75
• GBP/DKK 8.5256
• GBP/NOK 8.8074
• EUR/USD 1.4236
Pound vs Euro at 2 month High
Fears that countries like Italy Portugal and Spain may follow Greece and Ireland in defaulting on their debts have weakened the Euro further, pushing exchange rates up to their best in 2 months. This is despite the Pound falling due to a run of poor UK data showing the economy is sluggish.
Analysts still expect rates to drop back away as focus shifts back to fundamental data. It’s a great time to buy Euros, and if you need the best exchange rates to buy Euros in the next 6 months, send us a free enquiry now to find out more about our exchange rates and how you can fix the current rate, even if you don’t need your currency for some time.
US Debt bill passed into law
President Barack Obama has signed legislation to increase the US debt ceiling and avert a financial default, after Congress voted in favour of a bipartisan compromise deal. But the bill’s passage failed to lift financial markets.
On Wall Street stocks ended Tuesday down by more than 2%, amid poor consumer spending data for June. Moody’s rating agency reacted to the bill by placing Washington’s AAA credit score under a “negative outlook”. Without a deal to raise the debt ceiling, the US would have been unable to meet all its bills, the treasury department had warned.
You can read more about this here on the BBC website. In terms of the effect on the currency markets, the US Dollar has not strengthened significantly as expected. It may be that the agreement is simply viewed as delaying the inevitable, and is merely a plaster on a gaping wound.
Australian Retail Sales and Trade Balance figures are released today. From the Eurozone there are also Retail Sales figures. The EU and UK both release Purchasing Managers Index which is a measure of inflation. Stateside, watch for Mortgage Approvals and Factory orders.
If you need to buy or sell foreign currency, click below now to send us an enquiry for free. Our exhange rates are up to 5% better than offered by banks. Take the first step to making the most of your currency now.