The main release coming out of the UK yesterday was news that retail sales fell 0.4% last month in the UK, a significantly bigger fall than expected. But sales in the three months to March were 2% higher than the last three months, the highest rate since July 2006, in a sign of consumer resilience.
And monthly sales growth was revised up in January and February, the Office for National Statistics said, indicating that consumer spending is holding up.
The annual rise of 4.6% was higher than the 4.3% anticipated by most analysts.
Usually we would expect the March figure to have a negative effect for Sterling but the upwardly revised figures for January and February bolstered the Pound which at our close of business was up over 1% against the Euro, 1.6% against the Swiss Franc and over 0.5% up against the Aussie and Kiwi Dollars to name but a few. The indication is that even with the credit crunch and the well documented credit crunch people are still hitting the high street.
This coupled with the Bank of England lowering interest rates to 5% from 5.25% earlier this month, (its third cut since December) does give optimists the chance to see the a slightly rosier tint through their glasses for the next couple of months.
Analysts are suggesting that these retail figures make it less likely the Bank will cut rates again soon. Vicky Redwood, UK economist at Capital Economics, said the 0.4% fall was "not at all bad" and made it likely the Bank of England's Monetary Policy Committee would move cautiously in cutting rates further. She later added “We continue to have our doubts about how accurate a picture of high street demand the official figures are giving. Just about every other indicator... has weakened much more sharply. And this more gloomy picture sits far more comfortably with the plummeting level of consumer confidence." These comments, which I believe to be far more telling will, particularly for those who are currently seeing a half empty glass, indicate that we are certainly not out of the woods yet and we may not have yet seen Sterling bottom out yet against most currencies, but most significantly the Euro.
It is in uncertain times like these that even the most cavalier of us should look at the possibility of protecting themselves again currency fluctuations, our experienced, award winning dealers will be happy to discuss with you the range of contracts that we have available which can be tailored to your specific requirements.
In other news Gordon Brown has said he will not be diverted from the "right long-term decisions" for the UK's economy even if they are "unpopular in the short term".
The prime minister told the BBC he wanted to show people worried about homes and jobs the economy was "safe for them over the next few months". He spoke after a Downing Street meeting with bank chiefs to discuss ways to boost confidence in the housing market.
The Bank of England has now injected more than £50bn since the start of the credit crisis, which was sparked by massive losses for UK banks who lent in the US sub-prime sector.
Downing Street said the talks - with bosses from Lloyds, Barclays, HSBC, Royal Bank of Scotland and Nationwide - were not a crisis summit and had been in the prime minister's diary for some time.
Mr Brown said discussion included measures to ensure lenders pass on the Bank of England's interest rate cuts to mortgage borrowers.
The important thing to note here is that we are being told that these are not crisis meetings and that they are a regular occurrence, my concern is that because of the seriousness of the economic situation in the UK, these meetings are now major front-page news.
I believe that all the time this is the case we are going to continue to see vast sums of money currently invested in Sterling denominated assets such as stocks, shares and bonds being moved in to other economies; and basic supply and demand tells us that if lots of people are selling one thing (Sterling) it becomes cheaper. And if lots of people are looking to buy something (Euros, Dollars, Swiss Francs etc.) they are likely to get more and more expensive.
The main data release today is UK GDP figures from the first quarter of 2008 at 9.30am where we are expecting the quarter on quarter and year on year figures to be slightly down, possibly leading to some Sterling weakness early on today.
In other news it was announced yesterday that in some UK prisons inmates are so comfortable that they do not want to escape, a prison officer union leader says.
Glyn Travis of the Prison Officers Association says inmates are happy to stay inside because they can get hold of drugs, mobile phones and even sex.
He said a dealer regularly broke into a Yorkshire prison by using a ladder to enter cell windows - but no inmate used the ladder as a means of escape.
If you are looking for a more honest way to find your dream residence why not have a look at the ‘000’s of properties on http://www.propertyline.co.uk/ one of the world’s largest international property portals.
If you have any questions regarding this report, or wish to discuss an upcoming requirement with an experienced broker that will talk on your level, please email me at djw@currencies.co.uk providing a telephone number and i will get in touch straight away.
Have a great day and thanks for reading!
Daniel Wright
And monthly sales growth was revised up in January and February, the Office for National Statistics said, indicating that consumer spending is holding up.
The annual rise of 4.6% was higher than the 4.3% anticipated by most analysts.
Usually we would expect the March figure to have a negative effect for Sterling but the upwardly revised figures for January and February bolstered the Pound which at our close of business was up over 1% against the Euro, 1.6% against the Swiss Franc and over 0.5% up against the Aussie and Kiwi Dollars to name but a few. The indication is that even with the credit crunch and the well documented credit crunch people are still hitting the high street.
This coupled with the Bank of England lowering interest rates to 5% from 5.25% earlier this month, (its third cut since December) does give optimists the chance to see the a slightly rosier tint through their glasses for the next couple of months.
Analysts are suggesting that these retail figures make it less likely the Bank will cut rates again soon. Vicky Redwood, UK economist at Capital Economics, said the 0.4% fall was "not at all bad" and made it likely the Bank of England's Monetary Policy Committee would move cautiously in cutting rates further. She later added “We continue to have our doubts about how accurate a picture of high street demand the official figures are giving. Just about every other indicator... has weakened much more sharply. And this more gloomy picture sits far more comfortably with the plummeting level of consumer confidence." These comments, which I believe to be far more telling will, particularly for those who are currently seeing a half empty glass, indicate that we are certainly not out of the woods yet and we may not have yet seen Sterling bottom out yet against most currencies, but most significantly the Euro.
It is in uncertain times like these that even the most cavalier of us should look at the possibility of protecting themselves again currency fluctuations, our experienced, award winning dealers will be happy to discuss with you the range of contracts that we have available which can be tailored to your specific requirements.
In other news Gordon Brown has said he will not be diverted from the "right long-term decisions" for the UK's economy even if they are "unpopular in the short term".
The prime minister told the BBC he wanted to show people worried about homes and jobs the economy was "safe for them over the next few months". He spoke after a Downing Street meeting with bank chiefs to discuss ways to boost confidence in the housing market.
The Bank of England has now injected more than £50bn since the start of the credit crisis, which was sparked by massive losses for UK banks who lent in the US sub-prime sector.
Downing Street said the talks - with bosses from Lloyds, Barclays, HSBC, Royal Bank of Scotland and Nationwide - were not a crisis summit and had been in the prime minister's diary for some time.
Mr Brown said discussion included measures to ensure lenders pass on the Bank of England's interest rate cuts to mortgage borrowers.
The important thing to note here is that we are being told that these are not crisis meetings and that they are a regular occurrence, my concern is that because of the seriousness of the economic situation in the UK, these meetings are now major front-page news.
I believe that all the time this is the case we are going to continue to see vast sums of money currently invested in Sterling denominated assets such as stocks, shares and bonds being moved in to other economies; and basic supply and demand tells us that if lots of people are selling one thing (Sterling) it becomes cheaper. And if lots of people are looking to buy something (Euros, Dollars, Swiss Francs etc.) they are likely to get more and more expensive.
The main data release today is UK GDP figures from the first quarter of 2008 at 9.30am where we are expecting the quarter on quarter and year on year figures to be slightly down, possibly leading to some Sterling weakness early on today.
In other news it was announced yesterday that in some UK prisons inmates are so comfortable that they do not want to escape, a prison officer union leader says.
Glyn Travis of the Prison Officers Association says inmates are happy to stay inside because they can get hold of drugs, mobile phones and even sex.
He said a dealer regularly broke into a Yorkshire prison by using a ladder to enter cell windows - but no inmate used the ladder as a means of escape.
If you are looking for a more honest way to find your dream residence why not have a look at the ‘000’s of properties on http://www.propertyline.co.uk/ one of the world’s largest international property portals.
If you have any questions regarding this report, or wish to discuss an upcoming requirement with an experienced broker that will talk on your level, please email me at djw@currencies.co.uk providing a telephone number and i will get in touch straight away.
Have a great day and thanks for reading!
Daniel Wright
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