BOE keeping interest rates at 0.5%
Bank of England keeping interest rates at 0.5%
The Pound has inched higher against the Euro last night before retreating slightly this morning. The rise came after traders and investors learned little that they were not expecting from the European Central Bank’s meeting yesterday.
The Bank of England also stuck to market expectations by keeping its interest rates at 0.5%. Against the US Dollar, the Pound has followed the upward trend of riskier currencies, rising to a 3-1/2 month high. With the ECB meeting out of the way, it is expected that investors will now go back to focusing on UK data.
Currently, the Pound is trading in the region of 1.259 against the Euro and 1.596 against the US Dollar.
The ‘Greenback’ has weakened against the perceived riskier currencies following yesterday’s European Central Bank announcement of its new bond-buying intervention plan. The losses were limited, however, by a succession of strong economic data out of the world’s largest economy. Better-than-expected employment figures saw the strongest data since the first quarter of this year.
Currently, the US Dollar is trading in the region of 0.627 against the Pound and 0.791 against the Euro.
The Euro has risen broadly today as Spanish 10-year bond yields fell below 6% for the first time since May thanks to the new ECB plan announcement. The new plan will see the Bank lower borrowing costs for indebted Eurozone countries.
ECB chief Mario Draghi said that the Bank would undertake unlimited, short-dated bond purchases under strict conditions to ease funding pressures on governments that sought help. He added that the ECB would not expect better treatment than other creditors in the case of default.
Currently, the Euro is trading in the region of 0.793 against the British Pound and 1.267 against the US Dollar.
The ‘Aussie’ is trading up against the US Dollar and a basket of other currencies after it shrugged off further bad news over the deterioration of the country’s trade performance. The markets instead chose to focus on the news out of the Eurozone. According to the Australian Bureau of statistics, the country posted a trade deficit $556 million.
Currently, the Australian Dollar is trading in the region of 0.647 against the Pound, 0.816 against the Euro and 1.031 against the US Dollar.
New Zealand Dollar
The ‘Kiwi’ is holding its ground and trading up against the US Dollar. The news out of the ECB saw the perceived riskier currencies post gains against the American currency. The ‘Kiwi’ will also see gains due to strong employment figures out of the US. The better-than-expected figures are expected to lower the chance of the Federal Reserve introducing a new round of quantitative easing.
Currently, the New Zealand Dollar is trading in the region of 0.504 against the Pound, 0.635 against the Euro and 0.803 against the US Dollar.
The ‘Loonie’ has shot up to a four-month high against its US relation due to the strong jobs data out of the world’s biggest economy and the revelation of the ECB’s bond-buying plans. Risk sentiment has soared as the markets become optimistic that the global recession has hit a turning point.
The currency also strengthened against the majority of its 16 most-traded counterparts after fewer Americans than forecast filed applications for unemployment benefits last week and ECB President Mario Draghi said policymakers had agreed on the unlimited debt-buying program. It is also expected that the number of Canadians out of work will drop showing signs that North America is starting to get its economy back on track.
Currently, the Canadian Dollar is trading in the region of 0.639 against the Pound, 0.806 against the Euro and 1.018 against the US Dollar.