Buy Currency Online – Excellent Currency Solutions

Revised second quarter GDP figures show the UK economy contracted -0.7% in the second quarter, slightly less than the -0.8% previously recorded. Economic and industrial confidence for the eurozone has come in positive this morning, while US personal consumption figures are likely to cause some currency volatility later in the day.

Pound Sterling – UK Markets

Sterling exchange rates came under continued selling pressure yesterday after weak retail sales reduced confidence in the pound. This morning sterling rose slightly against its European and Asian currency partners, trading at 1.62 against the US dollar and 1.13 against the euro.

Despite positive housing figures yesterday, the pound came under pressure from a report which showed business investment in the UK has fallen the most in 24 years. GDP figures released this morning have been revised upwards, showing that the UK economy contracted -0.7% in the second quarter, rather than the -0.8% previously recorded. This could help lift sterling today, while UK exchange rates will also likely be affected by consumer figures out in the US.

US Dollar – US Markets

Exchange rates for the US dollar are slightly lower this morning, losing ground against the pound, Australian and Canadian currencies. The greenback has climbed against the yen, euro and New Zealand dollar ahead of key consumer releases in the US today.

The core personal consumption index is due in the US today and this, along with personal income and expenditure for July will help provide an insight into consumer spending in the US economy. Consumer activity is crucial to economic recovery and the figures are expected to rise following the “cash for clunkers” initiative. The figures are due this afternoon.

Euro – European Markets

Euro currency rates have dipped slightly this morning, although the single currency remains at the top of recent ranges, particularly against the pound. The euro is currently trading at 1.43 against the US dollar and 0.87 against the pound.

The euro is heading for its second monthly gain on the US dollar, as euro sentiment has improved following the emergence of France and Germany from recession. German consumer confidence has leapt to a three-year high and European markets have gained this morning following positive results from Dell and higher metal prices. Economic and industrial confidence for the eurozone has exceeded market expectations this morning, while consumer confidence came in slightly lower than expected.

Other Currencies – Highlights

Currency exchange rates for the yen remain strong this morning, following news that Japan’s unemployment rate rose to 5.7%, ahead of the expected 5.4%. Consumer prices are also falling at record levels and as this comes on the eve of the general election, the news is a blow for incumbent prime minister Taro Aso.

Australian currency exchange rates are heading for the longest month of gains in over 20 years against the US dollar following a rally on the back of economic recovery. Record low interest rates and rising commodity prices have helped lead the Australian currency higher in recent months against the yen and US dollar. The New Zealand dollar is also on the verge of seven months worth of gains against the yen.

This morning’s figures show the German business climate and expectations rose in August, sparking further gains for the euro which has strengthened against its major currency partners. Sterling sentiment remains weak, putting pressure on currency rates for the pound, while Japanese export levels have fallen for the tenth straight month.

Pound Sterling – UK Markets

Sterling currency rates touched on a 10-week low against the single currency yesterday, falling to 1.1410 in the midst of weak market sentiment. This morning the pound continues to fall, trading at 1.13 against the euro and 1.63 against the US dollar.

Sterling sentiment remains extremely weak at present, due to the absence of positive UK data and growing levels of government debt. The rise in German business confidence has led to increased pressure on the pound, though economists are speculating this could be positive for sterling as a euro recovery, combined with weak exchange rates will help stimulate UK exports. The next two days are light for UK data with GDP figures released on Friday.

US Dollar – US Markets

The US dollar rose for the fifth consecutive day against the pound, as markets responded favourably to the news that Ben Bernanke would be appointed a second term as Fed chairman. This morning US currency rates are valued at 0.69 versus euro and 0.61 against the pound, while declining against the yen, Australian and New Zealand dollars.

US consumer confidence figures released yesterday show confidence rose for the first time in three months, reaching 54.1 and topping the 50 mark which separates negative from positive data. House prices however, continued to decline, falling 6.1% in the second quarter despite a 0.5% rise in the month to July. Today new home sales figures and durable goods orders will be of interest to US markets.

Euro – European Markets

Euro currency rates have continued to rally this morning, gaining a further 0.3% on the pound and 0.15% on the US dollar. The single currency has also gained against its Asian and European currency partners, touching on 0.84 against the pound and 1.43 against the US dollar.

The German IFO business climate survey has risen to 90.5 in August, while expectations have also risen to 95. The German import price index came in at -0.9% on the month but overall, the euro is stronger due to dramatically improved sentiment in the eurozone. There is no further data in the eurozone today, with economic, consumer and industrial confidence released later in the week.

Other Currencies – Highlights

In Japan export levels have declined in July, falling for the tenth straight month sparking fears that the effects of global stimulus packages may be beginning to wane. Export levels fell 37.5% in July, more than the 36.5% recorded in June. Currency rates for the yen have climbed against the pound, euro and US dollar this morning.

Annual inflation rates in Brazil have slowed for the third consecutive month, prompting speculation that the central bank will keep interest rates low until mid 2010. Currency rates for the Brazilian real fell 1% against the US dollar following the news, and are currently trading at 1.86 per US dollar.

The pound remains weak this morning as markets digest news of a record budget deficit in the UK. The euro continues to rally following positive PMIs for the manufacturing and service sectors and the Canadian dollar was boosted yesterday by a recommendation to buy from Goldman Sachs.

Pound Sterling – UK Markets

Sterling foreign exchange rates have declined this morning as markets digest the record budget deficit announced yesterday. The pound has declined against its major currency partners, with the exception of the Australian and New Zealand currencies.

New that the UK is running a record budget deficit kept sterling under pressure yesterday, with the pound remaining in low ranges against the euro and US dollar. Rising government debt may have contributed to the MPC decision to increase QE levels by another GBP50 billion and rising retail sales did little to boost investor sentiment. There is no major data in the UK today.

US Dollar – US Markets

US dollar foreign exchange rates received a boost yesterday after negative jobless figures triggered a spike in risk aversion. This morning the US dollar is trading at 0.69 against the euro and 0.60 against the pound.

New jobless claims rose by 576,000 in the week to August 15, more than markets expected which led to a bout of risk aversion yesterday. US dollar gains were trimmed however by the Philadelphia Fed which showed manufacturing in the region expanded for the first time in over a year. This is an important snapshot of the region as a whole. US existing home sales are out this afternoon.

Euro – European Markets

Foreign exchange rates for the euro remain strong this morning, climbing against its major currency partners with the exception of the yen and Swiss franc. The euro is currently valued at 1.42 against the US dollar and 0.86 against the pound.

German PMIs for both manufacturing and services have shown positive results this morning, coming in at 49 and 54 respectively. This is in line with positive German data released earlier in the week, indicating that the eurozone’s largest economy is on the way to economic recovery. PMI’s for the eurozone are slightly worse, coming in just under the 50 mark. There is no further data in the eurozone today.

Other Currencies – Highlights

Foreign exchange rates for the Australian dollar gained nearly a cent against the pound yesterday, after the UK budget deficit came in at a record figure. News that the Philadelphia Fed has expanded helped raise foreign exchange rates for the Aussie and Kiwi currencies, through boosting international risk appetite.

The Canadian dollar has also received a boost after wholesale sales rose 0.6% in June, the first increase in 9 months. Goldman Sachs also recommended buying Canadian dollars against the US in the short term which sent the CAD to a weekly high against the greenback.

Sterling foreign exchange rates have risen sharply against the US dollar this morning in response to figures showing the service sector expanded in July. Employment figures and factory orders due in the US today could cause currency volatility while Bank of England and ECB interest rate decisions due tomorrow.

Pound Sterling – UK Markets

Sterling foreign exchange rates have spiked against the US dollar this morning, rising above 1.69 on the back of positive economic data. The pound has also risen against its international currency partners, trading just below 1.18 against the euro.

The UK service sector PMI has expanded to 53.2, ahead of market expectations in July. Manufacturing production has also expanded by 0.4% adding further evidence to the case that the UK economy is on the road to recovery. This will be good news for the Bank of England who will make a decision regarding interest rates and quantitative easing levels tomorrow.

US Dollar – US Markets

Foreign exchange rates for the US dollar are mixed this morning, trading in choppy ranges against the euro and pound recently as risk appetite fluctuates in the market. This morning the greenback is valued at 0.58 versus the pound and 0.69 versus the euro.

Today is packed with US data that is likely to cause more currency volatility. Employment change, factory orders and ISM manufacturing data are released, to be followed by initial jobless claim figures tomorrow. These will help contribute to economic sentiment in the world’s largest economy and are likely to influence global risk appetite. If positive, this could influence the US dollar and yen negatively.

Euro – European Markets

Foreign exchange rates for the euro are also mixed, with the single currency climbing against the Australian and kiwi currencies while losing ground to the pound, yen and US dollar. The euro is currently valued at 1.43 against the US dollar and 0.84 versus the pound.

European retail sales shrunk -0.2% in June, contracting at an annual rate of -2.4%. The European service sector PMI has also noted a modest rise, climbing to 45.7 showing that the 16-nation eurozone could be beginning to climb out of recession. European stocks have climbed this morning in response to the news. An interest rate decision from the ECB is due tomorrow.

Other Currencies – Highlights

Australian foreign exchange rates have dipped from their yearly high as investors hedge risk ahead of unemployment figures released tomorrow. This has led the Australian dollar to reverse some of its gains from speculation that the Reserve Bank will raise interest rates by the end of the year. The New Zealand unemployment rate is also due tomorrow and this could limit appetite for the South Pacific currencies.

The Canadian dollar has weakened overnight, after the Canadian finance minister voiced concerns at the rapid rise of the currency. The CAD has recently appreciated to a 10-month high on the back of rising risk appetite, performing the best of 16 currencies against the US dollar last month. The central bank has noted they will verbally intervene if they believe CAD appreciation will inhibit recovery prospects.

Sterling and euro exchange rates have trimmed losses against the US dollar this morning as rising retail sales in the UK and profits at Credit Suisse supported the currencies. US equity markets remain relatively quiet as investors digest news from Ben Bernanke’s speech, while revived risk appetite has strengthened the Australian and New Zealand dollars.

Pound Sterling – UK Markets

Sterling exchange rates have recovered ground this morning, as positive UK retail sales figures have led the pound to reverse its losses yesterday following the MPC minutes. This morning the pound has strengthened to 1.65 against the US dollar and 1.16 against the euro.

UK retail sales rose 1.2% in June, on track for a 2.9% increase this year. B&Q, Next and Morrisons have all reported rising sales and healthy forecasts as the summer heat wave boosted spending. While these figures tend to support the view of recovery in the UK economy, retail sales are a volatile statistic GDP estimates due on Friday could provide a better indication. The CBI has reported that 250,000 jobs may be lost in the manufacturing sector as factory orders fell to new lows in July. There is no further data in the UK today with a GDP estimate out tomorrow.

US Dollar – US Markets

US dollar exchange rates have dipped this morning as markets digest Bernanke’s speech and recover a little appetite for risk. The greenback has gained 0.76% against the yen and weakened against the pound and euro, currently trading at 0.6047 and 0.7025.

US markets had a relatively quiet day yesterday with the S&P finishing marginally down despite gains in European equities. The US dollar continued to be supported by risk trading as corporate earnings at Morgan Stanley came in worse than expected, sending the dollar higher against its international currency partners. Home sales and jobless claims are out in the US today and this will likely affect the US dollar exchange rate and risk appetite in the market.

Euro – European Markets

European exchange rates are holding firm this morning, trading at 1.42 against the US dollar and 0.86 against the pound. The euro has sunk against the Australian and New Zealand dollars as investors are prepared to take on limited risk.

The European current account deficit has narrowed to EUR1.2 billion in May, its smallest level in over one year. This is much less than the market expectation of a EUR5.8 billion deficit. Second quarter profits at Credit Suisse, Switzerland’s largest bank, have risen 29% as profits from trading and investments rose. The news sent shares in the bank 3.8% higher and has supported the euro this morning. Today is light for euro data with the PMI for manufacturing and services due tomorrow.

Other Currencies – Highlights

The New Zealand dollar inched closer to a nine-month high against the US dollar yesterday as rises in Asian stock markets boosted New Zealand dollar exchange rates. The Australian dollar also rose to a one-month high against the greenback, gaining to 81.89 US cents.

The Brazilian central bank has lowered interest rates by 0.5% to 8.75%, a new record low in the hope of stimulating the Brazilian economy. Domestic demand is still driving growth in Brazilian, with 4% expansion expected this year. Inflation is currently running near government targets of 4.5%, leading economists to speculate that interest rates could stay on hold at this level for sometime.

Strong corporate earnings figures in the US and positive Chinese economic data supported risk and equity markets yesterday, sending currency exchange rates across Europe and Asia higher. The figures boosted market sentiment across the board and led to a US dollar selling session with exchange rates improving for the Pound, Australian and New Zealand dollars.

Pound Sterling – UK Markets

Sterling exchange rates are in familiar territory against its international currency partners this morning, trading at 1.63 against the dollar and 1.16 against the euro. The pound has also gained over 0.3% against the Australian, New Zealand and Canadian dollars on the back of improved risk appetite.

The rising UK unemployment rate put sterling under pressure yesterday as official figures showed unemployment had reached the highest level in 12 years. However the pound was able to trim losses with strong US corporate earning figures and GDP in China boosting appetite for risk in the market. There is no major data in the UK today, with sterling exchange rates likely to be affected by the results of the Philadelphia Fed released this afternoon.

US Dollar – US Markets

Exchange rates for the US dollar slid yesterday as strong corporate earning figures buoyed market sentiment and increased risk appetite. The dollar lost ground against the yen, pound and euro, although has pared losses this morning to currently trade at 0.71 versus the euro and 0.61 against the pound.

Minutes from the FOMC meeting released yesterday noted that any further funds from the Federal Reserve would depend on “the Committee’s evolving expectations for the economy”. The Fed have increased their economic outlook, revising growth figures upwards, but the rising balance sheet is an immediate concern. Strong corporate earnings from Intel and Goldman Sachs triggered a dollar sell off yesterday and the Philadelphia Fed manufacturing survey is due in the US today.

Euro – European Markets

The euro exchange rate climbed 1% against the US dollar yesterday, touching on 1.41 on the back of rising market confidence. The euro has since dropped back against the dollar, currently trading at 0.85 versus the pound and 1.40 versus the dollar.

European indices surged ahead yesterday, with French, German and UK stock markets all gaining over 2% following positive figures in the US and China. Consumer prices have declined in France for the second month in a row, falling 0.6% from a year ago due to lower energy prices. There is no data due in the eurozone today with construction output and the trade balance released tomorrow.

Other Currencies – Highlights

Overnight figures from China show annual GDP growth of 7.9% and industrial production growing 10.7% in the past year, supporting this GDP growth. Inflation rates are falling in China, declining 1.7% on the year, with annual retail sales down to 15% growth, falling from a peak of 23% last year. Overall the Chinese economy remains strong and this led to a wave of optimism in global markets yesterday, sending exchange rates higher for the higher yielding currencies.

Consumer inflation in New Zealand rose by 0.6% in quarter 2, slightly higher than the 0.4% forecast by the Reserve Bank. The New Zealand dollar gained over 2 cents against the pound yesterday on the back of strong profits from Intel and Goldman Sachs and has continued to gain this morning, currently trading at 2.55 to the pound.

The annual rate of inflation in the UK has fallen below the Bank of England’s 2% target for the first time in 21 months. Today’s calendar is packed with economic data that could cause a reshuffling of currency exchange rates that will potentially benefit some of the higher yielding currencies. Markets will focus on US retail sales figures and the producer price index out this afternoon.

Pound Sterling – UK Markets

Sterling currency exchange rates have recovered this morning, boosted by falling inflation rates in the UK. After touching on a five-week low against the euro and falling to 1.60 against the US dollar yesterday, the pound is currently trading at 1.16 and 1.63 against the euro and dollar respectively.

Consumer prices in the UK have risen 0.3% on the month to June yet the annual inflation rate has fallen to 1.8%. This is the first time in 21 months inflation has fallen below the Bank of England’s 2% target. The retail price index also rose by 0.3% in June and has fallen by -1.6% annually, dragged lower by a reduction in mortgage approvals. These figures could be interpreted positively by markets as an indication that inflation is levelling off. The DCLG house price index has fallen by -12.5% on the year, better than market expectations and inline with observations that the property market could be bottoming out. Tomorrow, average earnings and the unemployment rate are due in the UK.

US Dollar – US Markets

The greenback has lost ground this morning with currency exchange rates declining on the back of positive market data in the UK. The dollar has gained against the yen, Brazilian real and Swiss franc however, as investors diversify from the traditional safe havens.

US equity market staged a minor rally yesterday as a report suggested corporate earnings at Goldman Sachs could rise as much as 15% The S&P closed the day 2.5% up and the boost allowed sterling exchange rates to recover against the dollar. This rally however was complicated by the fact that Larry Summers, an economic advisor to the White House, commented that we may not have seen the bottom for GDP yet and underlying trends remain uneasy. US retail sales and the producer price index will be the focus of foreign exchange markets later in the day.

Euro – European Markets

Euro currency exchange rates are weaker this morning, sinking on the back of downbeat industrial production figures and increased risk appetite. After surging to a five-week high yesterday, the euro has lost 0.5% to the pound while posting gains on the yen, US dollar and Swiss franc.

Eurozone industrial production has fallen 0.5% in May, with the annual rate of decline running at -17%. This is a slight recovery from the -21.6% decline predicted the previous month but is still a massive knock to confidence in the euro. The EUR/USD currency exchange rate has found support at 1.39 after being rejected at 1.40 yesterday. Also this morning the German ZEW economic survey has fallen to -39.5 in July, in contrast to market expectations. As the largest economy in the region, confidence in the German economy is crucial and these figures are likely to affect euro sentiment throughout the day.

Other Currencies – Highlights

Hungarian inflation rates have also unexpectedly slowed in June, falling to 3.7% from 3.8% the previous month. This increases chances of an interest rate cut for Hungary as stable inflation and a less volatile currency are improving investor confidence in the forint. Currency exchange rates for the Hungarian forint have risen to 275.79 per euro this morning. After declining 16% against the euro in the last year, the forint has recovered 5% in the last three months.

Japanese stocks rose overnight, led higher by the US market rally and the expectation of positive corporate earning figures. The yen has lost ground as global confidence rises and markets await results of the Japanese election and Bank of Japan interest rate decision.

GDP for the first quarter has contracted -2.5% in the eurozone, a figure in line with market expectations and one that takes the annual rate of decline to -4.9%. Exchange rates for many of the high yielding currencies are lower this morning, particularly the pound which is under pressure in anticipation of trade balance figures and the MPC interest rate decision due tomorrow.

Pound Sterling – UK Markets

Sterling exchange rates hit a one-month low against the euro yesterday, the third consecutive day of losses as the pound was put on the back foot from weak industrial production and manufacturing data. This morning the pound has declined to 1.6 against the US dollar and 1.15 against the euro, sliding ahead of the interest rate decision tomorrow.

The first round of second quarter GDP predictions has arrived with the NISER predicting the economy will shrink by -0.4%. Halifax house pricing figures released this morning show that prices have declined -15% on the year, with a -0.5 decline in June partially reversing the 2.6% rise in May. Weak UK data is leading to speculation that the Bank of England will add to its quantitative easing programme and this has reduced support for the pound. Today is light for UK data with sterling exchange rates likely to be affected by trade balance and GDP figures out tomorrow.

US Dollar – US Markets

US dollar exchange rates have climbed this morning, continuing gains from recent days on the back of market risk aversion. The dollar is currently valued at 0.71 versus the euro and 0.62 versus the pound.

The G8 summit kicks off today although with Chinese President Hu Jintao delayed, debate over the status of the USD as the premier reserve currency is likely to be put on hold. Recent uncertainty in the market has led investors to flock to the safe haven dollar in droves, quelling doubts over the position of the dollar as reserve for the moment. The Japanese yen has also risen to six-week highs against the euro and pound on the back of uncertainty. Today in the US MBA mortgage application figures are released with jobless claims figures out tomorrow.

Euro – European Markets

Euro exchange rates reached a one-month high against the pound yesterday, boosted by bullish German data and weak figures from the UK. This morning the euro has continued to gain, currently trading at 0.86 versus the pound and 1.39 against the US dollar.

Euro exchange rates received a boost yesterday from German factory orders which unexpectedly jumped to 4.4%. This is in contrast to industrial production figures in the UK, where markets expected a 0.2% rise but in fact got a -0.5% contraction. This morning first quarter GDP figures for the eurozone show the economy contracted -2.5% in the first quarter, in line with market expectations. German industrial production figures are also due this morning and this is likely to provide further insight into how the eurozone economy is faring.

Other Currencies – Highlights

Australian dollar exchange rates reached a three-week high against the pound yesterday as weak figures in the UK and the RBA interest rate decision renewed optimism in the Australian economy. Consumer confidence in Australia also surged by 9% in July and new mortgage lending rose by 2.2%. However despite the positive data, the pound eventually trimmed losses to close the day up against the Aussie dollar following news that Asian economies face a steep climb out of recession. Internationally, appetite for risk is low and this is putting pressure on exchange rates for the Aussie and Kiwi dollar.

Both the ECB and the Bank of England opted to leave interest rates unchanged yesterday, at 1% and 0.5% respectively. The Bank of England also opted to leave QE levels unchanged. Today foreign exchange markets will be interested in US employment data and this could influence the underlying dollar trend in the coming week.

Pound Sterling – UK markets

UK foreign exchange rates have declined from the seven-month high against the dollar and five-month high against the euro earlier this week on the back of political uncertainty in the UK. Despite positive economic figures, news that the Labour government is facing MP resignations dragged the pound down to 1.60 against the dollar and 1.13 against the euro. UK foreign exchange rates have also declined against a basket of international currency partners.

The UK producer price index out this morning has hit a multi-year low, largely on the back of falling oil prices. Yesterday, the Bank of England voted to keep interest rates on hold at 0.5% and maintain current levels of quantitative easing. This led to investor optimism that the MPC plan to stimulate the economy may be working. However despite the positive news, the fragile political situation has been negative for sterling exchange rates. Today, foreign exchange markets in the UK are likely to be affected by US employment data and political news from the government.

US Dollar – US Markets

Results are mixed for the US dollar this morning as foreign exchange rates have been volatile in the run up to the release of US employment data. The dollar has declined against the pound and euro this morning, but has gained against the yen, Canadian dollar and South African rand.

Employment data released in the US today is likely to be the major influence on foreign exchange rates internationally as the labour market is central to global recovery. The current market consensus is for a 0.3% rise in the US unemployment rate to 9.1%. Yesterday the US currency dipped in response to concern over the dollar’s status as an international reserve  although this ground has been recovered this morning. Average hourly earnings, the non-farm payroll and official unemployment rate are released today.

Euro – European Markets

Foreign exchange rates for the eurozone have improved this morning with the euro currently trading above 1.4 against the US dollar and 0.88 against the pound. The euro has also gained against the yen and Canadian dollar while losing ground to the Aussie and Kiwi currencies.

The ECB left interest rates unchanged at 1% yesterday and President Trichet commented that they may remain on hold for some time, as the euro economy is expected to begin a gradual recovery in 2010. With the eurozone expected to experience a greater downturn than the UK, euro foreign exchange rates may be slightly bearish versus the pound in the short term. There is no data due in the eurozone today.

Other Currencies – Highlights

The Australian and New Zealand dollars rose for the third consecutive week against the yen as investors favoured the higher yields based on speculation that the global recession is abating. An interest rate decision from the Reserve Bank of New Zealand is due next week and the NZD could experience some volatility in the run up to this. In the meantime, global foreign exchange trends based on US employment data are likely to affect foreign exchange rates for the Kiwi and Aussie currencies.

Both sterling and euro currency rates are at their highest level this year against the US dollar as market sentiment continues to improve following news the pace of recession is moderating. This is despite news that General Motors, once the world’s largest auto manufacturer, is to declare bankruptcy later in the day. This week brings interest rate decisions from the Bank of England, European Central Bank and Australian Reserve Bank.

Pound Sterling – UK markets

The sterling currency rate weakened against the euro on Friday, closing the day at 1.14. In early trading this morning, the pound has risen to 1.15 against the euro and 1.64 against the US dollar. This is the highest level in 2009 for sterling, fuelled by the improvement in global confidence.

Sterling currency rates have climbed across the board this morning, with the pound reaching some of the best currency rates in 2009 against its major currency partners. This positive sentiment is based on the view that decline in the UK economy may be nearing a bottom. The UK PMI for manufacturing released this morning shows an improvement to 45.4, climbing from 43.1 towards 50 which indicates a positive result. The Bank of England’s MPC will meet later this week for an interest rate decision. With rates currently at a record low of 0.5%, no change is expected and any further activity is expected to be based on quantitative easing.

US Dollar – US Markets

The dollar has declined against most of its international currency partners this morning, trading over 1.3% lower against the pound and 0.6% lower against the euro. US currency rates have also sunk over 1.4% against the Australian and New Zealand dollars.

Currency trends for the US dollar are bearish at present and are expected to remain so over the coming month. Weakness in the auto sector is weighing on dollar sentiment and levels of QE in the US are keeping investors uncertain. General Motors, once a symbol of American consumerism and the world’s biggest company, is to declare bankruptcy later in the day. GM is one of the most high profile casualties of the credit crunch and is expected to undergo a short “surgical” bankruptcy with a new “leaner” company to be launched in 60 days. Personal income and consumption figures are due in the US today and these often provide a degree of market volatility as they are closely related to retail sales and consumer confidence.

Euro – European Markets

The euro has also benefitted from a rise in risk appetite internationally, gaining over 0.5% on the dollar to trade at some of the best currency rates this year. The euro is currently valued at 1.42 against the greenback, 0.86 against the pound and 134 against the yen.

After touching on the best currency rates in 2009 against the US dollar on Friday, the euro has continued to gain this morning on the back of improved risk appetite. This is despite the bankruptcy of General Motors which is expected to cost up to 20,000 European jobs. The PMI for manufacturing in both Germany and the eurozone have continued to climb this month, showing a modest improvement in the European manufacturing sector. The EMU unemployment rate is released tomorrow.

Other Currencies – Highlights

The Australian dollar has surged against the pound and US dollar overnight as improved risk appetite and commodity prices support currency rates for the higher yielding currencies. Numbers of new building permits and the RBA interest rate decision for June are due overnight and this could induce some currency volatility for the Aussie dollar.

The Canadian dollar has also gained overnight on the back of more positive market sentiment, climbing nearly one percent on the US currency. Figures released in China overnight indicated a modest expansion in manufacturing activity and this has boosted market sentiment in North America. Canadian GDP figures and industrial product prices are due this afternoon.