Sterling strength against most major currencies
Snapshot:
GBP vs EUR +0.62%
GBP vs USD +0.64%
Yesterday’s trading saw a fairly volatile start against most of the major currencies and actually started off taking losses against the Euro and the Dollar. Once we hit mid afternoon it had managed to turn it around and we saw a reverse of fortune with a fairly marked improvement for Sterling.
House Prices DropYear on Year
Nationwide reported in their house pricing survey yesterday that UK house prices have suffered their first annual fall for 12 years and the speed of their monthly decline is ever increasing. House prices dropped for the sixth consecutive month in April and although the decline slowed marginally over December and January, since February the pace has picked up. The last time house prices fell year-on-year was March 1996.
The average house price in the U.K is now £178,555 – 1 percent lower than they were this time last year dropping £1759.00!
The continued negative outlook for the UK housing market reinforces the gloomy economic picture and increases the likelihood of further rate cuts. The Bank is widely expected to cut rates by 25 basis points from the current 5 percent next month or in June. This is likely to weigh on the strength of sterling for the next couple of months and keep the pound restrained.
Afternoons trading
Afternoon trading yesterday saw the pound slowly climb which appeared to be due to investor risk appetite.
The pound, with interest rates of 5 percent, benefits from the carry trade where investors borrow low-yielding currencies to fund purchases of higher yielding assets.
All in all the outlook remains negative but there are days where we are seeing large spikes in the market creating good buying opportunities.
Last night saw the US Fed decision. The decision was to cut by 0.25 basis points to 2.0% in order to promote economic growth and price stability although that could now be the end of the cycle.
The day ahead sees a vast amount of data due out from the U.S again, namely consumer expenditure, jobless claims, april unemployment rate and personal income data all released at 12:30pm whilst factory orders are due out at 14:30.
All of this data could have an effect on the markets movement, so be prepared for another volatile day and keep your eyes open as catching just a 1% spike in the market on a £250,000 purchase can save you £2500.
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
Snapshot:
GBP vs EUR +0.62%
GBP vs USD +0.64%
Yesterday’s trading saw a fairly volatile start against most of the major currencies and actually started off taking losses against the Euro and the Dollar. Once we hit mid afternoon it had managed to turn it around and we saw a reverse of fortune with a fairly marked improvement for Sterling.
House Prices DropYear on Year
Nationwide reported in their house pricing survey yesterday that UK house prices have suffered their first annual fall for 12 years and the speed of their monthly decline is ever increasing. House prices dropped for the sixth consecutive month in April and although the decline slowed marginally over December and January, since February the pace has picked up. The last time house prices fell year-on-year was March 1996.
The average house price in the U.K is now £178,555 – 1 percent lower than they were this time last year dropping £1759.00!
The continued negative outlook for the UK housing market reinforces the gloomy economic picture and increases the likelihood of further rate cuts. The Bank is widely expected to cut rates by 25 basis points from the current 5 percent next month or in June. This is likely to weigh on the strength of sterling for the next couple of months and keep the pound restrained.
Afternoons trading
Afternoon trading yesterday saw the pound slowly climb which appeared to be due to investor risk appetite.
The pound, with interest rates of 5 percent, benefits from the carry trade where investors borrow low-yielding currencies to fund purchases of higher yielding assets.
All in all the outlook remains negative but there are days where we are seeing large spikes in the market creating good buying opportunities.
Last night saw the US Fed decision. The decision was to cut by 0.25 basis points to 2.0% in order to promote economic growth and price stability although that could now be the end of the cycle.
The day ahead sees a vast amount of data due out from the U.S again, namely consumer expenditure, jobless claims, april unemployment rate and personal income data all released at 12:30pm whilst factory orders are due out at 14:30.
All of this data could have an effect on the markets movement, so be prepared for another volatile day and keep your eyes open as catching just a 1% spike in the market on a £250,000 purchase can save you £2500.
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
No comments:
Post a Comment