GBP/USD Weekly Currency Update

Old Jan 25th 2010, 2:03 am
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Default GBP/USD Weekly Currency Update

Weekly Currency Update GBP/USD - Week ending 22nd January

Hi All,

As promised here’s a brief update on what’s been happening with the US Dollar over the last week.

Obama certainly shook the market when he announced far-reaching plans in response to public rage over the financial crisis, to overhaul the banks and rein in ‘excess and abuse’. He said ‘never again will the American taxpayer be held hostage by a bank that is too big to fail.’ Shares in the big Wall Street banks fell, but on the other hand shares in the regional banks rose.

Tuesday saw housing market data out from US which came in slightly better than expected; Building Permits (0.65m) and Housing Starts (0.56m) were mixed; housing starts were affected by unusually cold weather but permits jumped to a 14-month high and boosted confidence that the slow recovery in house construction after a 3-year slump could resume over the next few months. The housing market is at the heart of the economic problems in the US and the Federal Reserve will be reluctant to raise rates until this sector of the economy is showing signs of a durable recovery

On Wednesday we had Producer Price Index out a lot higher than expected (actual figure was 4.6% against a predicted 2.4%) This is a measure of inflation and suggests that interest rates in the US may have to be raised earlier than previously expected; USD strengthened as a result.


GBP/USD movement – High’s & Low’s of last week (18-01-10 to 22-01-10)

High’s: 1.6461
Low's: 1.6078

A movement of 2.38%

Difference on £200,000

High: $ 329,220
Low: $ 321,560

Difference of: $ 7,660

Whilst FX isn't the most thrilling of subjects, the sooner you begin to think about your money transfers, the more likely you are to make your money go further.

Regards,

Mark Bodega
Director - HiFX
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