Subscribe

feed image

Our FX reports

Adam Solomon's insight into business and corporate FX issues.
Your Questions on foreign exchange sent direct to the professionals.
The Economy News brings you the latest foreign exchange rate news.

FX Latest

Check Exchange Rate


Bank rates source: Exchange Rates

TorFX Corporate FX solutions

INSIGHT

Insurers challenged by increased wild fire risks
With Russian wildfires grabbing the headlines, the Lloyds of London insurance market warns that...Read more...
Swiss bankers dismisses earning season hype
The Economy News presents an excerpt of an article looking into the hype that is the earning season...Read more...
Defending Woodford's Zimbabwean investment
It is lazy journalism to describe the Zimbabwean economy of 2010 as being one that is in scandalous...Read more...
Forex markets await the stress test
Mark Deans at MoneyCorp gives his morning verdict on the forex markets.Read more...
Standard Chartered warn of increased likelihood of double dip recession
Standard Chartered researchers say premature fiscal tightening could cause double dip recession....Read more...
Home Forex Check Forex Rate Exchange rates: British Pound in moderate declines
Exchange rates: British Pound in moderate declines PDF Print E-mail
Written by Will Peters   
Thursday, 29 July 2010 09:41
Yesterday we saw the Pound head higher in response to declining risk sentiment. Today the FTSE 100 is higher, but the British Pound is lower. A new inverse relationship perhaps?

Currency Trading
Onboard revolutionary 
platform with
Competitive spreads
& Live training

The Pound Dollar exchange rate is 0.404% higher on the hour with 1 GBP = 1.5646 USD at 10 AM in London.

The Pound Euro exchange rate is 0.279% lower with 1 GBP = 1.1973 EUR.

The Pound Australian Dollar exchange rate is 0.676% lower with 1 GBP = 1.7346 AUD.

"The British Pound has declined moderately this morning, after a report from the Nationwide Building Society showed that UK house prices fell in July for the first time in five months, as tighter lending conditions and government cuts slow the economy and deter first-time buyers. The average cost of a home in the UK fell 0.5% from June, but prices are still up 6.6% from this stage last year," reports Adam Solomon, head of the trading desk at foreign exchange brokers Tor FX.

Looking at the broader trends, the exchange rate appears to have formed an inverse relationship with the equity markets as of late.

The British Pound was at new highs when the FTSE 100 was lower yesterday, and the reverse scenario is true today. While it is far to early to call any firm relationship, those watching the foreign exchange markets would do well to follow how the Pound exchange rates relate to other markets.

Solomon does suggest today that the UK currency is likely to continue its upward momentum against the U.S Dollar in the short-term, amid concerns of a double dip recession and increased fears over the state of the property and labour market.

"On technical grounds, the Pound's ability to hold above the 200-day moving average was also an important element, with a challenge on technical levels above $1.5620 before a limited correction," says Solomon.

Yesterday we saw the British Pound make significant gains against a basket of currencies, rising through $1.56 against the Dollar to the highest level in five-months, while the UK currency also re-visited the resistance level at 1.20 versus the Euro.

The Australian Dollar had declined heavily against the Pound and U.S Dollar, after the latest inflationary data showed that consumer prices fell short of initial expectations in June, reducing the prospect of an Australian interest rate hike next week.

The UK currency has risen sharply against all of the 16 most actively traded currencies, particularly the US Dollar, after a report in the US yesterday showed that consumer confidence declined to the lowest level in five months in June.

The Pound is also benefiting from the improvement in risk sentiment, as stocks and commodities continue to rally, reducing the appeal of the Japanese Yen and the U.S Dollar as a refuge.




Last Updated ( Thursday, 29 July 2010 09:43 )
 

Get a quote today for your corporate FX solutions