Dollar found an unusual cheerleader yesterday in the form of the Fed Chairman, Ben Bernanke. He stated that the Fed was “attentive to the implications of changes in the value of the dollar for inflation and inflation expectations”. Whether we see conscious steps to avert further weakening of the greenback remains to be seen but the comments alone helped, pushing dollar through long term resistance levels against the euro.

The euro also slipped against sterling making back a considerable portion of Monday’s Bradford and Bingley fuelled losses. UK construction data however was weak, with activity falling at the quickest rate since 1997.

Bernanke is also speaking today and will be watched for further hints as towards ‘strong dollar’ policy. The ADP employment change data due this afternoon is an important precursor for this Friday’s Non-Farms payroll figure and a strong figure could further underline the greenback’s resurgence.
Today’s Data
UK: 00.01 Nationwide Consumer
Confidence
Expected: na
Previous: 70.00
Actual: 69.00
EU: 09.00 PMI Services
Expected: 50.6
Previous: 50.6
UK: 09.30 PMI Services
Expected: 50.3
Previous: 50.4
US: 13.15 ADP Employment Change
Expected: -30k
Previous: 10k

Indicative Rates
Sell Buy
GBPEUR 1.2656 1.2682
GBPUSD 1.9556 1.9580
EURUSD 1.5435 1.5456
GBPJPY 204.22 206.32
GBPAUD 2.0400 2.0450
GBPNZD 2.5001 2.5078
GBPCAD 1.9795 1.9844
GBPZAR 15.15 15.21
USDZAR 7.74 7.77
GBPPLN 4.2700 4.2950
Rates are dependent on amount transacted
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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 authors own judgement as of the date of the briefing and are subject to change without notice.

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