Pound to Euro, US Dollar exchange rate: The Pound was given an unexpected boost

The Pound was given an unexpected boost yesterday morning as it was announced that the UK Manufacturing PMI improved from 45.2 to 49.5 in August. The Pound was given an unexpected boost yesterday morning as it was announced that the UK Manufacturing PMI improved from 45.2 to 49.5 in August.

Headlines

UK Manufacturing PMI improves – GBP optimism.
Draghi seeks to justify bond-buying – good news for the single currency.
US data will determine QE3 – US Non-farm data vital.
GBP trumps AUD NZD – AGAIN!

Sterling

The Pound was given an unexpected boost yesterday morning as it was announced that the UK Manufacturing PMI improved from 45.2 to 49.5 in August. The stronger-than-anticipated Manufacturing figure added to the growing opinion that the Bank of England will refrain from tinkering with monetary policy at their next meeting on Thursday. The improvement in Manufacturing output, therefore, bolstered sentiment surrounding the UK economy and boosted the value of Sterling in the currency markets.

Euro

The Eurozone equivalent Manufacturing PMI for August failed to flatter the currency bloc and could not match the UK’s improvement in that sector. Eurozone Manufacturing shrank slightly-more-than-expected at 45.1, with the German PMI also declining further to 44.7. During the morning the Pound to Euro exchange rate improved by over 0.3 cents as the Purchasing Managers Index deficit widened between the two economies.

However, during the afternoon, Mario Draghi gave another press conference in which he insisted that the proposed purchase of sovereign debt of up to 3-years maturity would not qualify as state aid and therefore would be legal within the framework of the European Central Bank. Upon hearing the latest crisis catching efforts from the ECB President, markets took it upon themselves to buy-up the Euro – in case Draghi does pull through on his word this time. As a result the Sterling / Euro rate fell back down by 0.3 cents to consolidate at around 1.2615.

US Dollar

The Pound appreciated by over a third of a cent against the US Dollar yesterday as the improving UK Manufacturing PMI reduced the chances of further quantitative easing measures from the Bank of England, whilst the threat of a return to the Fed’s easing cycle continued to negatively impact the US Dollar.

As the US economy draws ever closer to the fabled fiscal cliff, of heavy spending cuts and tax rises, the prospect of QE3 to prop up finances in the world’s largest financial system becomes ever more realistic. Subsequently it is becoming likely that we will see GBP/USD make a run at the psychological 1.6000 mark in the near future.

Canadian Dollar

The Pound to Canadian Dollar exchange rate spiked as high as 1.5695 during the afternoon before consolidating at around 1.5670 to mark a daily gain of around 0.2 cents. It seems that markets reacted favourably to the UK’s recent economic renaissance, personified today by the stronger-than-expected UK Manufacturing figure.

Australian Dollar

Sterling improved by over a cent against the Australian Dollar yesterday as the AiG Performance of Manufacturing Index remained in contraction at 45.3, the Australian Retail Sales index fell from 1.2% to -0.8% negative growth, and the Chinese Manufacturing PMI failed to impress, printing at a worrying 47.6.

New Zealand Dollar

The only way is up for the Pound against the Antipodean currencies at the moment and Sterling managed to post another positive 1.4 cent performance against the New Zealand Dollar yesterday as the worst Manufacturing figure to come out of China in over 3 years damaged sentiment in the Asian Pacific region.

Please find below today’s update which gives you an insight into the current market conditions, enabling you to keep informed and up to date on the latest currency movements.

Data Released Today

05:30 AUD Reserve Bank of Australia Rate Decision (SEP 4)

09:30 GBP Purchasing Manager Index Construction (AUG)

10:00 EUR Euro-Zone Producer Price Index (MoM) (JUL)

15:00 USD ISM Manufacturing (AUG)

Related posts:

  1. Pound to Euro, US Dollar exchange rate: The UK economy was treated to another positive boost
  2. Pound Sterling, the Euro and US Dollar exchange rate News – The Pound received a timely boost yesterday, rising back up through 1.13 versus the Euro exchange rate
  3. Pound Sterling, the Euro and US Dollar exchange rate News Flash – The Pound received a timely boost this morning
  4. Pound to Euro, US Dollar exchange rate: The Pound received a timely boost
  5. Pound to Euro, US Dollar exchange rate: The Pound to Euro exchange rate reached a fresh three-and-a-half year high of 1.2832

Article source: http://feedproxy.google.com/~r/ForeignExchangeOutlook/~3/F1r-08Ue08Y/

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