Good morning and welcome to today\u2019s foreign exchange market commentary on Monday, the 13th of February.<\/p>\n
So at last, some respite after two weeks of near madness. Greek lawmakers approved a new round of austerity measures on Sunday that will unlock a \u20ac130 billion-bailout package from the country\u2019s international creditors. Focus will now shift to the Eurozone\u2019s finance ministers\u2019 meet in Brussels on Wednesday. The pressure on Athens is building up over the bond swap deal that is expected to write-off \u20ac100 billion from the mountainous \u20ac350 billion in outstanding debts. Greek Finance Minister Evangelos Venizelos said the government must carry out the bond swap by Friday to have enough time to restructure its immediate obligations before the \u20ac14.5 billion debt matures on March 20. EU leaders are also seeking a signed commitment from Greek lawmakers promising to honour the austerity commitments before the country goes to polls in April.<\/p>\n
Another major economy coming out with weak Q4-GDP numbers was Japan. The economy shrunk by 0.6 pc in the fourth quarter, though it may be treated as a one-off affair. A strong yen and a supply-chain-disrupting flood in Thailand ensured businesses faced significant pressures on margins. The situation may call for some intervention from the country\u2019s central bank in future, but overall economic outlook remains robust. Japanese GDP is expected to expand by 1.7 pc in 2012.<\/p>\n
Italy auctions securities today morning and the demand will indicate if Mario Monti would require Greek-style bailout packages in future, albeit at a much bigger scale. The event also assumes significance since ratings agency S&P decided to downgrade 34 Italian banks on Friday, citing funding issues. An unusual move since we are just two weeks away from the second round of LTRO (Long Term Refinance Option), ECB\u2019s ingenious method of pumping liquidity in the banking sector.<\/p>\n
CURRENCY RATES OVERVIEW<\/strong><\/p>\n GBP\/EURO<\/strong> \u2013\u00a01.1918 If you want to get the best\u00a0currency<\/strong><\/a>\u00a0transfer<\/strong><\/a>\u00a0<\/strong>\u00a0prices it important to compare prices.<\/p>\n EURO: The common currency retraced its recent losses against the cable and the greenback after Greek austerity measures were approved. The EUR\/USD pair, after sinking to 1.1970 on Friday, jumps to 1.3264 this morning. The GBP\/EUR slumped to 1.1915 this morning after touching 1.1970 on Friday. Markets may remain volatile ahead of Wednesday\u2019s meeting of EU Finance Ministers in Brussels to ratify the bailout package to Athens.<\/p>\n USD: The dollar marked strong gains on Friday as investors became apprehensive about the Greek parliament approving the latest round of austerity measures. The single currency dipped 1 pc against the greenback as markets waited for the outcome in Greek parliament. The dollar index, a barometer of the greenback\u2019s strength, rose to 79.148 from 78.581 late Thursday. The USD also got a boost over better than expected jobs number in January. Stronger UK PPI numbers pushed the Sterling up to 1.5840 against the dollar. However, news of weak consumer sentiment in early February in the US drove the pair down to a session low of 1.5730 on Friday. Some of the losses have been made good after Sunday\u2019s Greek development. The GBP\/USD pair opens at 1.5813 this morning.<\/p>\n
\nGBP\/US$<\/strong> \u2013 1.5802
\nGBP\/CHF<\/strong> \u2013 1.4410
\nGBP\/CAN$<\/strong> – 1.5780
\nGBP\/AUS$<\/strong> \u2013 1.4691
\nGBP\/ZAR<\/strong> \u2013 12.1086
\nGBP\/JPY<\/strong> \u2013\u00a0122.76
\nGBP\/HKD<\/strong> \u2013\u00a012.2518
\nGBP\/NZD<\/strong> \u2013 1.8901
\nGBP\/SEK<\/strong> \u2013\u00a0 10.4895<\/p>\n