Published: 19 Nov at 5 PM Tags: Euro, Dollar, America, Eurozone, USA, Germany, Russia,
As the price of crude oil slumped to a five-month low, the currency's of nations which rely on the commodity declined.
Russia’s Ruble posted its first decline against the US Dollar for five days as oil tumbled, and was also negatively affected by an unexpected fall in Russia’s industrial output.
Economists expected output to increase by 0.5 per cent in October (year-on-year) but it actually fell by 0.1 per cent. This followed YoY growth of 0.3 per cent in September.
This result supports the Russian Economy Ministry’s decision to announce that the nation’s economic growth for 2013 will probably come in below the 1.8 per cent expected.
One Moscow-based analyst said this after the data was released; ‘Weakening of Russia’s economic fundamentals remains a problem for OFZs (a form of government bonds) and the Ruble.'
However, while the result was disappointing it wasn’t disastrous and is unlikely to prompt an interest rate cut by the Russian central bank. For that reason the Ruble’s decline wasn’t as extensive as it could have been.
As it stands, the Ruble is trading against the US Dollar in the region of 32.7260
In other currency news the Euro strengthened against the majority of its most traded rivals, notably hitting a four-year high against the Yen.
The common currency rallied earlier in the European session as a gauge of economic sentiment for Germany
rose to its highest level since 2009 and was able to extend gains as a European Central Bank official delivered cautious remarks regarding the use of negative interest rates.
Although ECB Board Member Joerg Asmussen did comment that the option of negative interest rates can’t be excluded he went on to assert that the central bank must be ‘very careful’ about deploying such a measure.
The Euro consequently advanced and is currently trading against the US Dollar in the region of 1.3525.
As of Tuesday, 19th November 2013, the Pound Sterling currency rates mentioned within this news item were as follows:
GBP EUR exchange rate was 1.1896, GBP USD exchange rate was 1.6136, and GBP RUB exchange rate was 52.7178.