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US Dollar (USD) Gaining, ?Kiwi? (NZD) Flops, Pound (GBP) Softens, Eurozone Disappoints

Published: 6 Aug at 11 AM Tags: Euro, Dollar, Pound Sterling, America, UK, Eurozone, Australian Dollar, New Zealand Dollar, Canadian Dollar, Australia, New Zealand, USA, Canada, Russia, South Africa,

Pound (GBP)

The Pound (GBP) has fallen against the US Dollar (USD) following UK Shop Price data which showed a steeper decline than anticipated on Wednesday. The Shop Price Index is used as an indication for inflation pressures and fell by -1.9% year-on-year, exceeding forecasts of a -1.6% decline. Wednesday will also see the publication of Industrial and Manufacturing Production figures which are forecast to come in lower on the year in June than they had in May. The Pound (GBP) is currently trading in the currency market at 1.6861 versus the US Dollar (USD) and 1.2614 versus the Euro (EUR).

Euro (EUR)

Wednesday has seen the Euro (EUR) stoop to an almost nine-month low versus the US Dollar (USD) following a string of upbeat US data; versus a disappointing run for Eurozone figures. Moreover, the Euro is trading lower amid geopolitical tensions as the Ukraine situation escalates. The National Australia Bank commented: ‘Coupled with a rise in Russian troops lining the Ukraine border and raising speculation of an imminent flare-up in tensions, this has allowed the Euro to underperform.’ The Euro is presently trading at 1.3361 against the US Dollar.

US Dollar (USD)

The US Dollar (USD) has attained a nine-month high against the Euro (EUR), and is rising against other majors in the currency market following a wealth of favourable US statistics. Tuesday saw the publication of US Factory Orders figures which showed a monthly increase of 1.1% in June, almost double the forecast gain of 0.6%. Furthermore, the US saw positive data by way of the ISM Non-Manufacturing Composite Index; the index attained 58.7, despite only being predicted to reach 56.5. The US Dollar is trading against the Euro (EUR) 0.7481 and the Pound (GBP) at 0.5930.

Canadian Dollar (CAD)

Wednesday has witnessed the Canadian Dollar (CAD) fall to its lowest point in the latter three months versus the bullish US Dollar (USD). Canada has come under scrutiny in recent weeks for its lacklustre economic performance, which economists believe is far more lethargic than the US. Furthermore, the commodity currency has dipped following a drop in crude oil prices that have sunk to a six- month low. Expert in the field Greg Anderson stated: ‘General risk-off sentiment has people buying US Dollars.’ The ‘Loonie’ is currently trading at 0.9117 versus the US Dollar.

Australian Dollar (AUD)

The Australian Dollar (AUD) is presently trading against the US Dollar (USD) at 0.9313, trading slightly lower as the US produces favourable data. The Reserve Bank of Australia maintained their current 2.50% interest rates on Tuesday; however, some believe that rate hikes will occur in Australia early in 2015. Industry expert Todd Elmer commented: ‘[The] RBA press release was not quite as dovish as people feared, we just had a reiteration of the comments we had last time.’ Thursday will see the Australian Performance of Construction Index published, alongside Employment Change and Unemployment Rate figures.

New Zealand Dollar (NZD)

Tuesday saw a mixed bag of figures for New Zealand with Employment Change reaching 3.7%, less than the forecast 4.0%. Conversely, the nation’s Unemployment Rate lowered to 5.6% in the second quarter down from 5.9% in the first. The ‘Kiwi’ however has been bruised by dairy prices falling, and the currency reached a two month low against the US Dollar. Barclays representative Hamish Pepper stated: ‘It’s a confluence of factors, all negative for the “Kiwi” Dollar at the moment.’ The New Zealand Dollar to US Dollar exchange rate currently resides at 0.8439.

South African Rand (ZAR)

The South African Rand is still trading amid volatility as the latest National Union of Metalworkers of South Africa (NUMSA) strike has come to a messy end. The National Association of Employers of South Africa (NEASA) have refused to allow NUMSA members to return to work, and won’t let them enter the premises. NEASA refuse to abide by the latest contract that has been signed by NUMSA members, counter offering instead a 7% raise—3% less than the agreed deal. NEASA stated: ‘It potentially affects everybody. It is voluntary and we don’t require those who do not wish to participate in the lockout to do so.’ The US Dollar (USD) is currently trading at 10.7683 against the Rand.
As of Wednesday, 6th August 2014, the Pound Sterling currency rates mentioned within this news item were as follows:

GBP EUR exchange rate was 1.2593, GBP USD exchange rate was 1.6853, GBP AUD exchange rate was 1.8027, GBP NZD exchange rate was 1.9891, GBP CAD exchange rate was 1.84, GBP RUB exchange rate was 60.8767, and GBP ZAR exchange rate was 18.052.
Patrick James About Author: (289 Posts)Patrick completed his economics degree just as the global financial crisis struck in 2008. In the intervening years Patrick has made his mark, climbing to a prominent position within a large financial services provider. As part of his role Patrick uses his expertise to advise companies of the best ways to safeguard against currency risk.

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