To view any past or present currency blogs please click on the following link www.worldfirst.com/blog

Bloody hell what a day! Rumours that British PM Gordon Brown had dramatically resigned sent the pound crashing by over 3 cents against the USD in a 10 minute period yesterday. GBP was able to make 100 pips back on the back of a rebuttal from Downing St but never looked composed in the remainder of the trading session. All support that GBP had built up over the past week against EUR gave way really rather easily and we now find ourselves fighting for 1.14 and no longer 1.16. Any further rumblings will continue to whittle away pound’s strength in the short term while the cacophony of calls for General Election will surely explode when the results of just how badly Labour have done in the local and European elections or should ministers resign from his cabinet.

The pound had started strongly as house prices in the UK saw their largest month-on month rise in nearly 8 years. The 2.6% is the 11th largest in the history of the index and has been attributed to an expansion in credit.

With the markets in the grip of rumour, intrigue, leadership and currency movements (we just need some sex and we could make a Bond movie – ed) it would have been easy to forget the Bank of England and ECB meetings and their long term effects on their respective economies, effects that will be long felt after Gordon Brown has finished his memoirs.

The Bank of England continued to play the ‘softly, softly’ game with no rate movement and a commitment to keep an open mind over further quantitative easing and warned over the possibility of a ‘W’ shaped recovery and that an early upturn is the swallow that doesn’t make a summer.

The ECB also left their rates on hold and pushed forward with their controversial €60bn asset repurchase. The market viewed this as a positive and continued its pressure on the pound.

It is the first Friday of the month and therefore it is Non-Farm Friday; a big maraschino  cherry on the ice cream sundae of risk. With the ADP figure on Wednesday printing around expectation we expect a poor jobs figure and forecast a fall of 680k. With all the swirls of risk it is likely to be a volatile day; call us if you have any questions.

World First’s Twitter page is up and running and we will be live ‘tweeting’ the impact of all these data releases and how they affect the markets. Click below for up-to-date news on all things currency. The address is http://twitter.com/World_First 

Please feel free to contact me jeremy.cook@worldfirst.com(jeremy.cook@worldfirst.com) if you have any questions or thoughts regarding these updates or if you are interested in a particular event in the calendar. If you would like to discuss your foreign exchange requirements, please contact our: Corporate Foreign Exchange on 020 7801 9050 or ourPrivate Client Currency Exchange on 020 7801 9080. Disclaimer: The above comments are only our views and should not be construed as advice. You should act using your own information and judgement. Although information has been obtained from and is based upon multiple sources the author believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute the author’s own judgement as of the date of the briefing and are subject to change without notice. Any rates given are “interbank” i.e. for amounts of £5million and thus are not indicative of rates offered by World First for smaller amounts. E&OE. Definitions of jargon/market terms can be found in our Glossary of Foreign Exchange Terms..

To view any past or present currency blogs please click on the following link www.worldfirst.com/blog

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