Daily currency report

Overview

The sterling rose after six consecutive days of weakness against the US dollar. In the US, factory activity in September was at its slowest since May 2005.

GBP

The sterling rose against the dollar, after a robust survey of manufacturing activity hardened the case for an interest rate rise in November. The stronger than expected manufacturing figures helped reverse the losses from last week.

USD

Although pending home sales and construction spending was stronger than expected, the dollar dipped after the Institute for Supply Management's survey showed a fall in prices paid. Investors have been closely watching the economic data for signs of a sharper slowdown in the US economy.

EUR

A firmer September manufacturing PMI report from the eurozone has helped to push the euro higher after it hit a range low against the US dollar.

JPY

Yesterday saw gains in the Japanese government bonds, following 10-year bond auction that produced the strongest results in nine months. The strong results suggested investors were willing to buy at current yield levels on expectations the Bank of Japan would raise interest rates only gradually.

Gerald De Giovanni, Commercial Foreign Exchange Travelex Malta, free phone: 800 77 33 22, www.travelex.com.mt

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