The pound remained under pressure yesterday although it managed to eke out some gains against the euro over the course of the day.
Sterling rebounded from an overnight level of 1.0750 back into the 1.08s but still remains very weak and this is likely to continue.
The main winner was the dollar yesterday as haven flows picked up over fears that the economic stimulus packages that have acted as life support many a country will be withdrawn too quickly. Picture the economy as a 4 year old boy and the stimulus packages as Dad. When the boy is learning to ride his bike Dad will keep his hands on his shoulders to act as stability however as soon as the bike is up to speed then the hands are withdrawn and the youngster runs off into the distance. However, many grazed knees and cut elbows tell us that should the hands be withdrawn before the bike is up to speed then the boy falls over.
The dollar benefited from this as, while most is down to a flight to safety, some believe that the US Federal Reserve will be the first to withdraw stimulus and tighten monetary policy. This is an obvious currency plus.
Data wise we kick off an extensive week with confirmation of the UK GDP figures for Q2, CBI Distributive Trends and house prices from the US.
You can also follow us live on Twitter at http://twitter.com/World_First
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Latest Exchange Rates At Time Of Writing
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Indicative Rates
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Sell
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Buy
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GBP/EUR
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1.0847
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1.0874
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GBP/USD
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1.5851
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1.5874
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EUR/USD
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1.4596
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1.4605
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GBP/JPY
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142.02
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142.47
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GBP/AUD
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1.8137
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1.8174
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GBP/NZD
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2.2028
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2.2070
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GBP/CAD
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1.7165
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1.7214
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NZD/USD
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0.7181
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0.7201
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GBP/ZAR
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11.69
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11.74
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USD/ZAR
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7.37
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7.41
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GBP/PLN
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4.5528
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4.5895
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EUR/JPY
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130.74
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131.11
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Rates are dependent on amount transacted. Please call 0207 801 9080 for a live rate quote.
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Please feel free to contact me (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 Team on 020 7801 9050 or our Private Client Currency Exchange Team on 020 7801 9080.
To view any past or present currency blogs please click on the following link www.worldfirst.com/blog.
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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.
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