Sterling could also see positive fluctuations due to tomorrow’s 3 billion Euro payment

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Pound Sterling

Talk of Chinese stimulus saw Sterling up on its US rival and beginning to ease away from a two-week low. However, the Pound’s gains were restricted by Euro zone protests and persistent uncertainty regarding a Spanish bailout. Consequently, the disclosure of Spain’s 2013 budget will draw market focus in the hours ahead. Sterling could also see positive fluctuations in light of the anticipation of tomorrow’s 3 billion Euro farm subsidy payments and the fact that the UK economy shrank slightly less-than-expected in the second quarter.

Currently the Pound is trading in the region of 1.2575 against the Euro and 1.6180 against the US Dollar.

US Dollar

After enjoying a bullish relationship with the majority of its peers for the past few days, investor appetite for safe-haven assets was reduced by positive Asian developments. This led to the US Dollar declining against most of its counterparts. After China’s central bank injected a record level of funds into the nation’s financial system Asian stocks extended gains and marketplace risk aversion dimmed. A slight dip in US New Home Sales was also recorded, although the figures remained close to a two-year high. US data to watch out for today includes US Weekly Jobless Claims, second quarter GDP and Pending Home Sales.

Currently the US Dollar is trading in the region of 0.6177 against the Pound and 0.7764 against the Euro.

The Euro

Yesterday the Euro recorded losses against practically all of its key competitors and allowed the British Pound to extend its recent gains. In light of violent anti-austerity protests in Greece and Spain, investor’s lost their appetite for riskier assets. Developments to watch out for in the hours ahead include the auction of 10-year Italian bonds. Should the bond auction demonstrate an increase in Italian borrowing costs or a decrease in the demand for Italian debt the common currency could continue its bearish trend.

Currently the Euro is trading in the region of 0.7956 against the British Pound and 1.2872 against the US Dollar.

Australian Dollar

The Australian Dollar benefited as speculation that China will take action to support national growth increased. As China is one of Australia’s most prominent trading partners this news has improved the export outlook for the latter nation. Consequently the ‘Aussie’ recouped losses and bounced back from a two-week slump. However, gains for the Down-under Dollar were limited as anti-austerity protests in troubled Euro zone nations Spain and Greece tempered demand for higher-risk assets.

Currently the Australian Dollar is trading in the region of 0.6430 against the Pound, 0.8072 against the Euro and 1.0408 against the US Dollar.

New Zealand Dollar

The increasing likelihood of further stimulus methods in China gave investors renewed confidence in the high yielding New Zealand Dollar. The ‘Kiwi’ consequently broke its three-day run of declines and gained in local trading. The currency’s rally followed the National Bank Business Outlook demonstrating that local firms were more optimistic regarding their own prospects despite having less confidence in the broader economy. The New Zealand Dollar advanced against its main rivals, rising from 50.69 British Pence to 51, from 63.65 Euro Cents to 64.08 and from 82.32 US Cents to 82.56.

Currently the New Zealand Dollar is trading in the region of 0.5105 against the Pound, 0.6416 against the Euro and 0.8258 against the US Dollar.

Canadian Dollar

Violent turmoil in Europe and falling commodity prices have had a negative effect on the Canadian Dollar following yesterday’s surge. Although the Conference Board of Canada reported an improvement in Consumer Confidence from August’s low, positive US data releases were overshadowed by dramatic scenes in Athens and Madrid. As trading closed ‘The Loonie’ had lost ground against its US counterpart. Analysts’ fear that continuing European turmoil will worsen the situation across the Atlantic and further lower commodity demand. As the performance of the Canadian Dollar is intrinsically linked to the performance of commodities ‘The Loonie’ could face some testing times.

Currently the Canadian Dollar is trading in the region of 0.6284 against the Pound, 0.7897 against the Euro and 1.0174 against the US Dollar