Sterling gains against the euro

Published: 18 October, 2011

Sterling slipped against the US dollar but gained against the euro yesterday after comments from a German policymaker deflated investor optimism over a potential euro zone bailout.

Currency rates - October 18

EURO/GBP - 1.1470

US$/GBP - 1.5768

CHF/GBP - 1.4178

CAN$/GBP - 1.6132
AUS$/GBP - 1.5532
ZAR/GBP - 12.6345
JPY/GBP - 121.31
HKD/GBP - 12.2671

NZD/GBP - 1.9945
SEK/GBP - 10.5422

AED/GBP - 5.795

US$/EURO - 1.3732

As a result, investors reversed the sell off of US dollars that began over the weekend following positive comments from G20 finance ministers regarding a definitive euro zone package announcement at next weekend's summit of European leaders. There was relatively little data released in the UK today, with investors awaiting key inflation and retail sales data later in the week which are expected to show that the UK recovery remains weak.

In the euro zone, the euro slid by 0.6% against sterling as investors looked to the relatively safer haven of sterling on the negative comments. Germany's finance minister Wolfgang Schaeuble stated that Sunday's summit of European leaders will not deliver a definitive solution to the region's debt problems. Out later today there is German economic sentiment data that is a key measure of confidence in the region.

In the USA, the US dollar strengthened against the euro, coming off a 1 month low against the single currency as investors became worried over Schaeuble's comments over the European summit this coming Sunday. There is a wide array of data released later today in the USA including wholesale price inflation and some housing data.

Elsewhere, the Canadian dollar had a strong week last week as investors looked towards higher yielding growth linked currencies. However, with the reversal in risk appetite yesterday, sterling gained by 0.7% against the currency in a few hours. Ensure you stay on top and take advantage of movements like this by speaking to one of the team at Smart now.

Supplied by Nick Ryder of Smart Currency Exchange, the currency partner to Harpers Wine and Spirit who have teamed up with Smart to provide readers with a free bespoke currency service. Go to www.smartcurrencybusiness.com/winespirit for more information or call on 0207 898 0500.

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