Sterling falls off six week high against dollar

Published: 26 October, 2011

Sterling slipped against the US dollar, falling off a six week high as perceived 'riskier' currencies came under pressure on growing concerns over today's EU summit.

Currency rates - October 26

EURO/GBP - 1.1501

US$/GBP - 1.6019

CHF/GBP - 1.4048

CAN$/GBP - 1.6230
AUS$/GBP - 1.5431
ZAR/GBP - 12.6858
JPY/GBP - 121.73
HKD/GBP - 12.4598

NZD/GBP - 2.0080
SEK/GBP - 10.4914

AED/GBP - 5.888

US$/EURO - 1.3920

However, sterling was slightly higher against the euro, hovering around €1.15/£1 as optimism over a fully comprehensive solution slipped. Markets have overall been very quiet as investors tread water to see the results of the summit, with no-one willing to hold large positions in case the reaction causes large movements against them. This saw hardly any movement as Bank of England governor Mervyn King testified to the Treasury over the decision to restart Quantitative Easing this month.

In the euro zone, plans to announce a final rescue deal today seemingly hit further hiccups yesterday as it was announced that a key meeting of European economic and finance ministers has been delayed. This meeting would prepare the detail of any political decision, so the implication is that a full package will not be available to scrutiny today. Markets clung onto optimism that a solution will be reached, but the euro slipped away against the US dollar on poor US data.

In the USA, poor financial results from several companies combined with a sharp drop in consumer confidence figures to add to a cautious tone yesterday. Demand for US government bonds rose as investors looked for a safe haven ahead of today's EU summit. In addition, the US dollar hovered around a record low against the Japanese yen on concerns over intervention by the Japanese authorities held back further purchases of the Japanese ultra-safe haven currency.

Elsewhere, the Vatican has finally waded into the debate over the credit crisis calling for sweeping reforms of financial markets and the creation of an ethical global authority to regulate financial markets.

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.

Printer friendly version