The Pound to Dollar rate improved from 1.550 in the morning

Foreign Exchange Rates Currency News - The Pound to Dollar rate improved from 1.550 in the morning

by Josh Ferry Woodard

Every New Year shoppers flock to the January sales; Christmas presents get returned; resolutions are broken; turkeys breathe a sigh of relief; and the currency exchange markets return to full functionality. New profit targets are set and new initiatives written up, to ensure rates fluctuate with the same vigour and volatility as the year before.

Market sentiments reflected the New Year feeling of freshness yesterday, with global equities flexing their muscles. London’s benchmark FTSE 100 index made gains of over 2.0% on the day with European indices and US equities following suit.

UK Economic data released yesterday showed an improvement in Purchasing Manager Index (PMI). Manufacturing (PMI) grew from 47.7 in November to 49.6 in December, falling just shy of the crucial 50.0 mark that separates contraction from expansion. This Manufacturing growth is encouraging, and coupled with today’s announcement that Construction PMI has grown from 52.3 in November to 53.2 in December, it offers a glimmer of hope that the UK may not slip back into recession.

However a net lending slash of £1.2 billion to £0.6 billion from October to November and a further reduction of 0.6% in the M4 Money Supply report keep the economic optimism in check.
Europe and the US also benefitted from some mildly positive releases yesterday with German unemployment falling by 6.8% to its lowest level since 1991 and US ISM Manufacturing growing to 53.9.

The global economy is showing signs of improvement and as a result risk appetite is growing; yesterday the safe haven US Dollar lost out by around a percentage point against most of its major rivals. The Pound to Dollar rate improved from 1.550 in the morning to daily highs of 1.570 before settling at 1.560, and it has continued to fluctuate around that figure throughout today.

Risk appetite also affects the commodity-correlated currencies of the Aussie Dollar and the New Zealand Dollar; both made gains against the Pound yesterday with the Australian Dollar pushing towards the key 1.500 level and the New Zealand Dollar flittering in the high 1.97′s before consolidating at 1.980 today.

Considering the compilation of complications that face the Eurozone it is possible that safe-haven flows could continue across the English Channel towards the Pound and cause the rate to grow further, but as we stand GBP/EUR is still fluctuating daily around the 1.200 mark.

Related posts:

  1. Pound Sterling, the Euro and US Dollar exchange rate News Flash – The Pound received a timely boost this morning
  2. Pound Euro US Dollar Exchange Rate Forecast – The Pound has declined heavily against the majors this morning
  3. Pound Sterling, the Euro and US Dollar exchange rate news – The Pound weakened against the majors yesterday morning
  4. Sterling Euro US Dollar NEWS FLASH – The Pound has rallied strongly against the majors this morning
  5. Pound Sterling, the Euro and US Dollar Currency News – The Pound came under renewed selling pressure against the Euro exchange rate

Article source: http://feedproxy.google.com/~r/ForeignExchangeOutlook/~3/bL2Q-UC0ivY/

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