:: United States Dollar: It has been a fairly quiet last 24 hours for GBP/USD as London returns from a bank holiday Monday. Focus is still on the election polls and markets are still betting on a hung parliament. This threat sees the Pound open under 1.5200 against the US Dollar at 1.5190 this morning. US data, released yesterday including Personal Spending and ISM Manufacturing data had little impact on the Dollar. Short term UK markets will be interested in local manufacturing data this morning whilst expect GBP/USD to continue to trade a fairly choppy range in the run up to Thursday''s election results.
- We expect a range today in the GBP/USD rate of 1.5110 to 1.5260
:: Euro: The IMF and Euro zone agreement to increase its bailout package to EUR 110 billion has failed to instil any confidence amongst investors and the Euro has slipped further against the US Dollar. Markets are still concerned over Greeces ability to put in to place the big budget cuts required. And after stating that he would not relax ECB lending rules in January, ECB President Trichet diluted the central bank rules again yesterday so that it could keep accepting Greek bonds as collateral which has also failed to convince markets. News of a 40 billion tax shortfall in Germany over the next 3 years has also hit Euro hard over the past couple of days as it is now threatening to sink below the 1.3000 big figure against the Dollar. It opens this morning at 1.3170. Meanwhile GBP/EUR remains steady and sits above 1.1500 still at 1.1540.
- We expect a range today in the GBP/EUR rate of 1.1500 to 1.1580
:: Aussie and Kiwi Dollars: As expected the Reserve Bank of Australia raised its base rate overnight by 0.25% to 4.5%. Despite this AUD/USD has actually fallen from .9270 to sub .9200 as Europe enters the market. It has pushed back up slightly in the last hour and trades at .9210 currently. It seems that markets are just too long AUD currently and with worries lingering over the state of the Greek economy investors don't seem hesitant to sell off risk. NZD/USD has been fairly steady in comparison, having been dragged slightly lower with AUD/USD. It sits at .7295. GBP/AUD and GBP/NZD open this morning at 1.6490 and 2.0820 respectively.
- We expect a range today in the GBP/AUD rate of 1.6400 to 1.6580
- We expect a range today in the GBP/NZD rate of 2.0760 to 2.0920
:: Data Releases:
- AUD: Building Approvals, AIG Services Index
- EUR: German Retail Sales
- GBP: Manufacturing PMI, Net Lending to Individuals
- NZD: No data due for release today
- USD: Pending Home Sales, Factory Orders