United States Dollar: What a difference a day makes as a quiet Monday was followed by and manic Tuesday. Cable was thrown high and low yesterday as a number of expected and unexpected releases took hold of the currency pair. A WSJ article saw Sterling start low yesterday, but positive UK current account data which saw the deficit narrowed to GBP 7.4 billion in Q2 saw the Pound fall just short of breaking through 1.5900 reaching 1.5880. It was all change when BOE’s Posen advocated resuming the policy of quantitative easing. This saw the Pound rapidly fall to 1.7540 versus the Greenback, but it has since recovered. It has taken MPC member Andrew Sentance to come out and challenge the need for QE as well as further negative data from the US to see the Pound move higher. US data saw consumer confidence fall to the lowest level since February this year, which again has sparked further talks for the need of QE in the US. Sterling, believe it or not, is sitting at 1.5827 this morning versus the Greenback.
– We expect a range today in the GBP/USD rate of 1.5740 to 1.5890
Euro: The single currency continues to rise against the Greenback. The WSJ article and talks of Moodys downgrading of Spain, similar to the Pound, didnt help the Euro against the Dollar early yesterday morning. The morning also got worse as S&P came out warning of possible further Irish downgrades. The losses were corrected for the Euro as German Gfk October consumer confidence came in stronger than median forecast. This was then followed by the ECBs Stark stating that a number of non-standard measures will mature Q4 and not be renewed, which is likely to be the turning point of positive credit growth. US negative data, as mentioned above, then capped off the gains for the Euro yesterday. The single currency opens at 1.3613 versus the Greenback this morning. The Sterling hasnt seen a good 24 hours versus the Euro. On the back of all that has been mentioned Sterling couldnt stop the Euro from pushing higher yesterday and sees the currency pair open today’s session at 1.1624.
– We expect a range today in the GBP/EUR rate of 1.1560 to 1.1720
Aussie and Kiwi Dollars: The Australian and New Zealand Dollars have erased their early losses against the Greenback yesterday. Both the antipodean currencies have seen new 30 day highs in the last 24 hours. The US Dollar has seen all the majors’ gain against it overnight with further negative data released state side. AUD/USD is back above 0.9700, but only by a couple of pips this morning. NZD/USD is currently at 0.7384. The Pound has fallen further against the Aussie and Kiwi. There is not much more to report than what has been said already to why we are sitting lower this morning, so GBP/AUD opens at 1.6301 and GBP/NZD is at 2.1404.
– We expect a range today in the GBP/AUD rate of 1.6210 to 1.6460
– We expect a range today in the GBP/NZD rate of 2.1320 to 2.1510
AUD: Building Approvals m/m, Private Sector Credit m/m, RBA Financial Stability Review
EUR: No data due for release today
GBP: Net Lending to Individuals m/m, Final Mortgage Approvals, Index of Services 3m/3m, Gfk Consumer Confidence
NZD: Building Consents m/m, NBNZ Business Confidence
USD: Crude Oil Inventories, FOMC Member Rosengren Speaks