Weekly Market Update 13-04-2011
 

Sterling slumps to a 5-month low against the Euro after UK inflation eases in March

Consumer price inflation data released yesterday morning showed the annual rate of price increases actually slowed last month for the first time in eight months to 4%. The markets were expecting the rate of inflation to have remained up at the 4.4% reported last month. This will further reduce the chances of an interest rate increase at the meeting next month and looking at the reaction of Sterling, it would seem the case as it fell against all of its major counterparts.

• The RICS survey for March showed a slightly larger than expected drop in the number of surveyors reporting house price falls versus those reporting gains

• Retail sales for March were awful with the biggest drop in sales at stores measured by value since the series began, falling 1.9% from a year earlier

• The UK trade balance which showed a good increase in exports and a decline in imports narrowing the deficit to £6.78bn against expectations it would widen to £8bn.

• Unemployment rate came in at 7.8% which was lower than expectations and reduced from last months figure of 8%


£/€
Range of the week: 1.1205 – 1.1372
Variance of the week on £10k= €167

• Eurozone Industrial production came in at 0.4% m/m which was better than last months figure but below expectations (0.8%)


£/$
Range of the week: 1.6226 – 1.6425
Variance of the week on £10k= $199

No major news so far this week. Retail sales and employment figures due out from the US tomorrow.


£/AUD
Range of the week: 1.5439 – 1.5668
Variance of the week on £10k= AU$ 229

• The Westpac-Melbourne Institute Index of Consumer Sentiment rose 1.2% in April from 104.1 in March to 105.3 in April. This was a fairly stable result but given the worldwide unrest over the last month, this is still a positive figure. Job prospects and security remain strong. It was recently announced that employment increased by 37,800 jobs in March reducing the unemployment rate to 4.9%.


£/NZD
Range of the week: 2.0563 – 2.1016
Variance of the week: on £10k=NZ$ 453

• Figures for March confirmed a marked rise in NZ housing market turnover. Sales lifted 5% in seasonally adjusted terms, despite the earthquake disruption in Christchurch. This is another reason for our clients to look to send funds over for house purchase sooner rather than later as house prices look set to continue rising.


£/ZAR
Range of the week: 10.8410 – 10.9880
Variance of the week: on £10k=ZAR 1470

No major news or data for the week so far


£/CAD
Range of the week: 1.5533 – 1.5704
Variance of the week: on £10k=CA$171

• Interest rates held by Bank of Canada at 1.00%