The euro strengthened against sterling on Thursday after the ECB outlined its exit strategy to unwind the recent stimulus and liquidity pumped into the European financial system.
While the headline interest rate figure was left at 1% as expected, it was details revealing that the next 12 month tender for funds would be the last of its kind, as they seek to painlessly reign in the extra funding available to the banking sector.
Neither the Bank of England nor Fed have taken such a transparent approach as yet to reveal their exit strategy, and it should continue to aid the single currencies strength for the short term. The euro reached the top of its recent range in the morning session against the dollar, but was pulled back in the afternoon.
Trichet also gave the Chinese a dig in the ribs, commenting that fixed rate currencies should let their currencies appreciate against both the dollar and euro.
Initial jobless claims were better than expected for the second week running, a positive sign coming into today’s non farm payrolls, due out at 13:30. The figure is expected to show a decline of roughly 125 thousand jobs, raising the unemployment rate to 10.2%. A better than expected figure should see the dollar continue its slide off, but I wouldn’t hold my breath.
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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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1.0999
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1.1025
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GBP/USD
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1.6600
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1.6624
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EUR/USD
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1.5077
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1.5098
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GBP/JPY
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146.02
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146.88
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GBP/AUD
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1.7914
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1.7960
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GBP/NZD
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2.2919
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2.2974
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GBP/CAD
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1.7503
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1.7539
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NZD/USD
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0.7226
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0.7252
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GBP/ZAR
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12.22
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12.25
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USD/ZAR
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7.3546
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7.3904
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GBP/PLN
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4.4887
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4.5167
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EUR/JPY
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132.60
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133.27
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Rates are dependent on amount transacted. Please call 0207 801 9080 for a live rate quote.
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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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