Daily Foreign Exchange Market Update

Wed, February 22, 2012

The Pound finished lower against the US Dollar and against the Euro in the foreign exchange market yesterday. The GBP/EUR exchange rate picked up from 1.1937 at the morning’s open to trade down to the days low of 1.1897, before trading back to 1.1916 by the close of the UK business day. The GBP/USD exchange rate traded lower after opening near the high of the day at 1.5853 to 1.5793 by the European market close. The Pound also finished lower against the New Zealand Dollar and the Australian Dollar in the foreign exchange market. The GBP/NZD exchange rate picked up from 1.8921 at the morning’s open to trade down to 1.8880 by the close of the UK business day. The GBP/AUD exchange rate opened up from 1.4796 and finished the session lower at 1.4768.

Yesterday from the UK we saw Public Finances (PSNCR) (Jan) come in much better than expected at £-16.8bln vs. £-24.7bln expected by economists. However Public Sector Net Borrowing (Jan) came in worse than expected at £-7.8bln vs. £-6.3bln, which is also down from £14bln previously.

The Euro gained against the pound, but declined slightly against the  US Dollar in the currency exchange market yesterday. The EUR/USD exchange opened up at 1.3274 to trade down to the day low of 1.3199 before closing out at 1.3255 by the European market close. Yesterday we saw Euro-zone Consumer Confidence (Feb) came in just off expectations at -20.2 vs. -20.1; but overall the figure was still better from the previous month of -20.7.

This morning we have seen a fair bit of economic data from the Euro-zone; with French PMI Manufacturing coming in better than expected at 50.2 vs. 49.0 and the French CPI coming in line with expectations at 2.6% vs. Exp. 2.8%. German PMI Manufacturing and Services both came in slightly lower, with Manufacturing coming in at 50.1 vs. 51.5 and PMI Services coming in short at 52.6 vs. 53.9 expected by economists.

Today we will look out for the 10:00 GMT Euro-zone Industrial New Orders expected at -2.8%.

The US Dollar gained against the Pound and against Euro currencies yesterday.  There was Economic data from the US yesterday with Chicago Fed Nat Activity Index (Jan) came in slightly better than expected at 0.22 vs. 0.21.

Today we will look out for the US Existing Home Sales (Jan) due at 15:00 GMT, which is expected to increase from $4.61m to $4.65m.

This Daily Market Update is brought to you by The Market Team @ KBRFX – Exchange Rate, Currency Conversion & Foreign Currency Transfer specialists.

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