Weekly Currency Update

The following article is a guest post.  If interested in submitting a guest post, please read my guest posting policy and then contact me.

EUR weekly currency update

The euro did well enough against the US dollar, strengthening by three quarters of a cent. It was less successful against the British pound, where it lost half a cent.

Neither the friends of the euro nor its enemies could find much to inspire them. Most of the Euroland economic data were either of low importance, in line with expectations or both. Headline inflation came in at 1.6%, exactly as analysts had predicted, and construction output slumped -5.1% in the year to May. ZEW’s surveys of economic sentiment among investment managers found them more upbeat in pan-Euroland but less so in Germany.

The euro failed to keep pace with sterling when the pound mounted a late upward rush after the Bank of England’s Monetary Policy Committee minutes unexpectedly showed no members voting for more asset purchases. Investors were surprised and pleased that the new governor had not pushed for renewed stimulus.

USD weekly currency update

Although it avoided the bottom slot on the currency league table the dollar was down there in the relegation zone. It lost three quarters of a cent to the euro and one and a half to the British pound.

As usual, it was the uncertainty surrounding US monetary policy that had most impact on the dollar. On this occasion it was Federal Reserve Chairman Ben Bernanke that sent the dollar lower when he gave his biannual testimony to Congress. He said nothing new but stressed that there would be no end to the $85bn a month assert purchase strategy until the economy improved.

The dollar failed to keep pace with sterling when the pound mounted a late upward rush after the Bank of England’s Monetary Policy Committee minutes unexpectedly showed no members voting for more asset purchases. Investors were surprised and pleased that the new governor had not pushed for renewed stimulus.

CAD weekly currency update

The Loonie fared better than the US dollar but only by a fifth of a cent. Sterling was well ahead, adding nearly one and a half Canadian cents.

Although Canada’s economic data weren’t bad, they were not good enough to inspire investors to buy the Canadian dollar. Manufacturing shipments were up by 0.7% in May and wholesale sales rose by an impressive 2.3% but investment inflows slowed and inflation jumped sharply from 0.7% to 1.2%.

The Canadian dollar failed to keep pace with sterling when the pound mounted a late upward rush after the Bank of England’s Monetary Policy Committee minutes unexpectedly showed no members voting for more asset purchases. Investors were surprised and pleased that the new governor had not pushed for renewed stimulus.

AUD weekly currency update

The Aussie added more than a cent against the US dollar. It could not outshine the pound in quite the same way, rising by less than a fifth of a cent.

There were not many Australian economic statistics and they didn’t bring much to the table. New vehicle sales jumped 7.1% in June while business confidence deteriorated be three points from +2 to -1. The Aussie’s main support came from the US central bank chief. He said nothing new but stressed that there would be no end to the $85bn a month stimulus scheme until the economy improved.

The Australian dollar would have done better against sterling had the pound not mounted a late upward rush after the Bank of England’s Monetary Policy Committee minutes unexpectedly showed no members voting for more asset purchases. Investors were surprised and pleased that the new governor had not pushed for renewed stimulus.

NZD weekly currency update

The Kiwi was one of the top performers. It strengthened by more than one US cent and went up by three quarters of a cent against the British pound.

There were not many New Zealand economic statistics and they didn’t bring much to the table. Inflation slowed from 0.9% to 0.7% in the second quarter of the year and visitor arrivals were up by 6.0% in June. The Kiwi’s main support came from the US central bank chief. He said nothing new but stressed that there would be no end to the $85bn a month stimulus scheme until the economy improved.

The NZ dollar would have done better against sterling had the pound not mounted a late upward rush after the Bank of England’s Monetary Policy Committee minutes unexpectedly showed no members voting for more asset purchases. Investors were surprised and pleased that the new governor had not pushed for renewed stimulus.

Track All Your Accounts With Personal Capital

Personal Capital lets you see all of your accounts in one convenient place.  Sign up now for free.

Brought to you by Moneycorp