Published: 5 Nov at 1 PM Tags: Euro, Dollar, Pound Sterling, America, UK, Eurozone, USA, South Africa,
With speculation surrounding the possibility of a European Central Bank rate cut growing amid increasing fears that the Eurozoneâ€™s tentative return to growth could be faltering, investors have turned to lower-risk assets and the Euro has dropped while the Yen has rallied.
During the European session news that the European Union has negatively revised its growth forecasts for the Eurozone for 2014 saw the common currency extend declines against several of its most traded peers.
The EU now expects the Eurozoneâ€™s economy to expand by 1.1 per cent in 2014 rather than the 1.2 per cent growth forecast in the spring, a fact which increases the odds of the ECB expanding its fiscal policy in the months ahead.
According to currency strategist Ulrich Leuchtmann; â€˜The closer we come to the ECB decision the more risk-off sentiment dominates. The feeling that market participants want to get more friendly with those safe havens like the Yen is to do with the ECB. Draghi will try everything to sound as Dovish as possible but I donâ€™t think weâ€™ll see concrete action this time.â€™
The Euro is currently trading against the US Dollar in the region of 0.7413.
In other currency news, South Africa
â€™s Rand added to its already significant decline against the US Dollar as labour strike concerns lessened the appeal of the emerging market asset ahead of Thursdayâ€™s mining/manufacturing production reports.
The Rand is currently trading against the US Dollar in the region of 10.1995
Meanwhile, the Pound enjoyed a bullish local session and was able to advance on the majority of its currency counterparts as the UK services sector recorded its most rapid expansion for over 15 years. Before the publication of US ISM non-manufacturing data the GBP/USD pairing was trading in the region of 1.6047
As of Tuesday, 5th November 2013, the Pound Sterling currency rates mentioned within this news item were as follows:
GBP EUR exchange rate was 1.191, GBP USD exchange rate was 1.6045, and GBP ZAR exchange rate was 16.4081.