France’s AAA rating looks under threat
| Current Spot Rates (9.30am) | |||||||||||
| USD | EUR | AUD | CAD | CHF | DKK | NOK | HKD | SEK | ZAR | JPY | |
| GBP | 1.6360 | 1.1505 | 1.6090 | 1.6324 | 1.1247 | 8.5732 | 9.0141 | 12.7800 | 10.62 | 11.89 | 126.528 |
| USD | 1.4212 | 0.9835 | 0.9978 | 0.6875 | 5.2403 | 5.5098 | 7.81 | 6.49 | 7.27 | 77.340 | |
| EUR | 0.7032 | 1.3985 | 1.4189 | 0.9776 | 7.4517 | 7.8349 | 11.11 | 9.23 | 10.33 | 109.977 | |
| Key Support and Resistance Levels | |||||||
| Support | Resistance | ||||||
| GBPUSD | 1.6072 | 1.6184 | 1.6248 | 1.6424 | 1.6536 | 1.6600 | |
| GBPEUR | 1.1322 | 1.1373 | 1.1442 | 1.1562 | 1.1613 | 1.1682 | |
| EURUSD | 1.3796 | 1.3963 | 1.4068 | 1.4340 | 1.4507 | 1.4612 | |
IN THE UK
Sterling pushes to a near 2 month high €1.1544 but has a mixed day against the dollar with a range between $1.6298 and $1.6471.
Quiet day overall for UK data as the pound relied on risk related trading
Investors eyes focus on BoE quarterly inflation report tomorrow and whether they cut the growth forecast
Overnight RICS House Price data for July showed a better than expected figure, moving from -26 in June to -22 in July, consensus was expected at -25.
FTSE currently trading at 4.4% down already.
Manufacturing and Industrial Production figure show declines across the board this morning, all figures were worse than expected.
ELSEWHERE
Equity markets continue to fall, S&P finishes 6.66% down and the DJ down 5.5%
Credit rating agency Moody’s confirm they are leaving the US unchanged at the time being.
France’s AAA rating looks under threat, as the cost to insure their debt rises sharply after the recent US downgrade.
ECB continue to buy back Spanish and Italian Bonds, however investors do not feel this will be a long term solution as this type of support cannot be sustained for countries facing financial difficulty.
JPY and CHF still continue to hold strong despite attempts by both their central banks to weaken their currencies with intervention.
Overall picture for the US looks bleak, however day-to-day data has been better than expected with recent unemployment figures falling.
DATA TO LOOK OUT FOR
UK Trade balance is expected to show a slight improvement from £-5.109b to £-4.8b for June
UK NEISR GDP Estimate results are published at 3.00pm, the data is an estimate of growth in the last 3 months before the official GDP figures are released. The report is generally seen as very reliable and can influence monetary policy. The last figure published was 0.1% and any surprises either to the up or downside could have a fairly dramatic effect on the pound.
This evening at 7.00pm the Fed Interest Rate Decision meeting will reveal US monetary policy for the near term future, interest rates are expected to stay at 0.25% and QE3 is unlikely to start today but the following press conference will provide us reaction to the recent S&P ratings downgrade and where the US want to head from here. There is the potential for overnight volatility throughout the currency markets in all pairs as risk is a big driver over recent weeks.
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