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Good morning and welcome to today’s foreign exchange market commentary on 7th of May.
Here are MyCurrencyTransfer.com’s top 5 currency highlights:
- Nikkei breaches 14,000.00 level for first time in five years
- AUD tumbles on RBA Rate Cut
- USD continues to gain on strong NFP and uncertain Euro
- Quiet week ahead could keep EUR within bounds
- UK manufacturing boosts GBP, ends week on a strong note
CURRENCY RATES OVERVIEW
GBP/EURO – 1.1882
GBP/USD – 1.5537
GBP/CHF – 1.4563
GBP/CAD – 1.5657
GBP/AUD – 1.5242
GBP/ZAR – 14.0034
GBP/JPY – 153.7711
GBP/HKD – 12.0579
GBP/NZD – 1.8296
GBP/SEK – 10.1729
Mid-market rates as of 2013-05-07 06:49 UTC
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Key releases in the next 24 hours that may affect currency date:
Australia: No Data
Europe: EUR German Factory Orders n.s.a. (YoY) (MAR)
United Kingdom: No Data
New Zealand: No Data
United States of America: USD Consumer Credit (MAR)
China: No Data
Canada: No Data
Nikkei breaches 14,000.00 level for first time in five years
Japanese index Nikkei continued to rise this morning, soaring above the 14,000 mark, an occasion that was last observed in June 2008. The benchmark index increased by 2.8% to 14,083.26, earlier today. Japanese markets have reacted positively after Bank of Japan introduced some drastic measures, including doubling money supply in its economy in order to simulate growth.
Meanwhile, the yen declined further which is another positive sign for the economy as Japanese exporters can make their goods more affordable to foreign buyers thereby boosting their profits when they bring their foreign earnings back into Japan. Shares of major Japanese exporters including Toyota and Nissan Motors rose by about 4% in today’s session.
AUD tumbles on RBA Rate Cut
Earlier today, Reserve Bank of Australia slashed interest rates by 25 basis points to record lows of 2.75 %, following the release of disappointing economic data last week that triggered reactions from industry to lower the cash rate. The AUD which has been trading lower against all its peers plummeted as the RBA decision was announced. RBA Governor Glenn Stevens has indicated that the rate cut was to stimulate long-term growth in the economy, which is currently stagnating although it should be noted that previous rate cut decisions have yet to show its effects on the economy.
USD continues to gain on strong NFP and uncertain Euro
USD advanced against its peers on Monday post US Labor department release of positive nonfarm payrolls report as well as owing to the Euro’s uncertain outlook. The EUR/USD declined from 1.3135 to below 1.3100.
Quiet week ahead could keep EUR within bounds
The upcoming week is much more quiet for the single currency save for a few economic reports released during the yesterday’s European session including Retail Sales which was lower than expected at -2.4% compared to the estimated -1.9%, and several other PMI data. Economic data being released in the upcoming session will mainly be focused on German Factory Orders. Given the recent disappointing PMI data from Germany today’s release will be worth looking out for in case this overall trend carries on.
UK manufacturing boosts GBP, ends week on a strong note
A week of positive news and economic data from UK and abroad helped strengthen the GBP which was trading against the USD at the end of last week at 1.5572. The pound Sterling benefited from the latest UK manufacturing figures, which showed British PMI rising from 48.6 to 49.8 in April. This week began with a Bank Holiday in the UK and ends on a more interesting note for the GBP with the UK and German trade balances being released.
Have a great day!