Sterling finally bounces back

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Pound Sterling

The Pound has strengthened against the majority of its major counterparts, climbing from its yearly low against the Euro. The rise was a result of the latest consumer confidence sentiment index showing an increase from minus 29 to minus 26. House prices in the UK also showed an increase with the average cost of a home rising by 0.5%.

Against the Euro, Sterling rose from its weakest level in over a year.

US Dollar

The ‘Greenback’ weakened against the majority of its peers due to worse-than-expected advanced GDP figures denting confidence in the US economic recovery. Against the Euro, the Dollar is expected to slump to a six-month low as investors await the release of the latest US jobless claims figures. The figure for the number of people unemployed is expected to show an increase, which will further damage confidence that the world’s biggest economy can maintain its recovery.

The Euro

The Euro has continued to strengthen against the majority of its peers due to continuing high confidence emerging from the single currency region. As a result, demand for riskier assets continued to rise.

Today, Euro traders should be aware of the latest German unemployment figures. If the figure comes in above the forecasted nine-thousand it could lead to risk aversion in the market and reverse some of the Euro’s gains.

Australian Dollar

The ‘Aussie’ has weakened against the majority of its most traded counterparts due to a decline in Asian stocks sapping demand for higher-yielding assets.

New Zealand Dollar

The ‘Kiwi’ strengthened to a three-month high against its Australian relation after the smaller nation’s Central Bank said that it expects New Zealand’s economy to make a strong recovery. The Bank maintained its benchmark interest rate at 2.5%.

Canadian Dollar

The ‘Loonie’ declined against its US relation, but outperformed other commodity-linked currencies despite an unexpected contraction in the economy of its biggest trading partner. Canadian Dollar traders should be aware that the nation’s GDP figure for November is due to be released later today.

South African Rand

The Rand is range-bound ahead of the release of South Africa’s foreign trade data. The nation’s trade balance with its foreign trading partners is expected to have shown signs of improvement. Economists are forecasting that the country recorded an R3.1billion deficit in December from the R7.9billion deficit in November. If the figure comes in better-than-expected then the currency could see some improvement.

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