Advert

Daily currency report

Overview

The euro has made a strong start and looks set to dominate its main rivals ahead of a packed week of economic data and central bank meetings. The single currency jumped to six-week highs against the US dollar and may extend gains amid signs a more politically integrated Europe will stabilise Greece’s finances.

The US dollar is now trading at one-month lows against a currency basket as Washington struggles to tackle January’s’ approaching fiscal cliff, and ahead of US non-farm employment figures, which could signal that the Federal Reserve may have to do more to stimulate the US economy at its next meeting on December 12th.

Sterling remains beaten by a rising euro and a pick-up in risk appetite connected to Greece, and now faces a crucial week that includes the release of Britain’s latest PMI surveys, the Bank of England’s December policy announcement, and the UK Chancellor’s fiscal policy update.

Sterling

The pound is trading at over one-month lows against its European counterpart and is danger of sliding towards October lows after the German Government approved Greece’s latest bailout deal. Sterling is already facing a critical week, which could go a long way towards determining the currency’s flight into the Christmas break. PMI surveys covering Britain’s manufacturing and services industries will be significant, as will Bank of England policy meeting and industrial output figures.

US dollar

Stumbling progress regarding US fiscal cliff negotiations as well as month-end buying pushed the US dollar lower, and the US currency will subsequently start at one-month lows on a trade-weighted basis. The US dollar could also get caught between both monetary and fiscal policy speculation over the coming days. Investors are expected to remain highly sensitive to discussions involving the White House and January’s approaching fiscal threat of automatic spending cuts and tax hikes.

Euro

Investors seem to be strengthening their euro reserves again following progress concerning Greece’s loan arrangements and comments from Chancellor Angela Merkel suggesting a more relaxed Germany in terms of debt crisis management. The euro rose to six-week highs against the US dollar after Germany approved the latest financial-fix for Athens, and as analysts continue to monitor talks inside Washington as the US Government tries to find a way around January’s looming fiscal cliff.

Advert

Comments are submitted under the express understanding and condition that the editor may, and is authorised to, disclose any/all of the above personal information to any person or entity requesting the information for the purposes of legal action on grounds that such person or entity is aggrieved by any comment so submitted.

At this time your comment will not be displayed immediately upon posting. Please allow some time for your comment to be moderated before it is displayed.

For more details please see our Comments Policy

Comments not loading? We recommend using Google Chrome or Mozilla Firefox with javascript turned on.
Comments powered by Disqus
Advert
Advert