Sterling holds firm at €1.26/£1.
Sterling holds firm at €1.26/£1.
Sterling holds firm at €1.26/£1.
Currency Rates - July 10
EURO/GBP - 1.2606
US$/GBP - 1.5505
CHF/GBP - 1.5147
CAN$/GBP - 1.5822
AUS$/GBP - 1.5224
ZAR/GBP - 12.7521
JPY/GBP - 123.12
HKD/GBP - 12.0278
NZD/GBP - 1.9524
SEK/GBP - 10.8672
AED/GBP - 5.6964
US$/EURO - 1.2302
INR/GBP - 86.50
Today there is a raft of UK data released covering retail sales, industrial production and trade balances. Expectations are not high as business confidence continues to fall across the world. It is probably a case of what happens elsewhere that will be key in determining sterling's short term direction.
The key event in the Euro zone is the meeting of its finance ministers in Brussels who need to start implementing the decisions taken at the last EU summit. The implementation is not expected to be a quick process even though speedy action would be very helpful to economies throughout the world. With increased risk aversion we have seen the yields on Spanish and Italian debt continue to rise with the debt on the Spanish debt hitting 7% at one stage. The inverse happened to German government debt with yields becoming negative. I think this highlights clearly the contrasting fortunes within the Euro zone and the difficulties faced.
The US$ made significant gains at the end of last week and gave some of these back on Monday. In the US, just like in Germany, yields on US government debt fell as risk aversion came to the fore. The markets are waiting for the release of the minutes of the last Federal Reserve meeting which will detail their views on further quantitative easing.
Elsewhere limited news on a quiet Monday. Japan saw machinery orders fall by 14.8% in May to the lowest level for two years. This highlights worries that the Euro zone problems are having far reaching consequences on the world's economy.
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