Spain’s latest Foreign exchange and austerity package
Spain’s latest austerity package
Sterling managed to achieve a three-week high against the Euro as investors learned that the UK economy contracted by less-than-forecast in the second quarter. The British currency’s advance against its European rival was slightly offset following the announcement of Spain’s latest austerity package but the prospect of EU farm subsidy payments kept it higher against its American counterpart. Furthermore, with Bank of England policymaker Paul Fisher predicting a strong UK GDP figure in the third quarter Sterling could be poised for future gains.
Currently, the Pound is trading in the region of 1.2557 against the Euro and 1.6233 against the US Dollar.
After starting the week strongly the US Dollar experienced a brief reversal of its bullish trend following the release of a batch of disappointing US data. However, the American currency’s dip didn’t last for long as investors turned to safe-haven assets, so in the wake of Eurozone concerns ‘Cable’ enjoyed a boost. With little in the way of significant US news expected in the hours ahead, any volatility in the currency will probably be in response to European developments.
Currently, the US Dollar is trading in the region of 0.6154 against the Pound and 0.7735 against the Euro.
After a week of weight concerns in the Eurozone, the 17-nation currency bloc finally received a much-needed boost. Spain has been one of the main causes of investor unease over the past few days, but now that the country has pledged to adhere to its deficit target confidence in Eurozone recovery is beginning to return. As Spain improved its bailout prospects the Euro was able to recoup recent losses. However, the common currency was prevented from reversing declines against its US rival due to doubt in French economic growth and the expectation of Eurozone manufacturing contraction.
Currently, the Euro is trading in the region of 0.7966 against the British Pound and 1.2932 against the US Dollar.
With the outlook for Australian exports brightened by the expectation of stimulus in China the Australian Dollar was able to end the week more strongly than it began. The ‘Aussie’ also gained on most of its competitors as demand for the currency was bolstered following the announcement of Spain’s fifth austerity package. Analysts are predicting that the currency will advance 1.3 percent from August, gaining 2.2 percent this quarter.
Currently, the Australian Dollar is trading in the region of 0.6430 against the Pound, 0.8082 against the Euro and 1.0457 against the US Dollar.
New Zealand Dollar
Increasing optimism in China and rallying Asian stocks could see the New Zealand Dollar achieve a 4.3 % quarterly gain. A strengthening belief that the slowdown in the world’s second-largest economy could be eased allowed the ‘Kiwi’ to continue advancing on the majority of its peers, hitting 51.35 British Pence, 64.55 Euro Cents and 83.5 US Cents.
Currently, the New Zealand Dollar is trading in the region of 0.5133 against the Pound, 0.6456 against the Euro and 0.8344 against the US Dollar.
After another week of fluctuations, there was good news for the Canadian Dollar. The ‘Loonie’ gained almost half a US Cent after data revealed that gold had reached a seventh month high. The Canadian currency’s advance was aided by disappointing US data and the increasing likelihood of a Spanish bailout. A Statistics Canada report also showed that the average weekly earnings to non-farm payroll employees were up by 1.1 percent from the previous month. With Canadian GDP figures for July due for release in a few hours the ‘Loonie’ can expect further movement.
Currently, the Canadian Dollar is trading in the region of 0.6289 against the Pound, 0.7894 against the Euro and 1.0217 against the US Dollar