:: United States Dollar: Focus on Friday was on the release of US Non Farm Payrolls data. Although still weak, it came in better than expected - 247,000 jobs were lost in July, fewer than forecasts for 320,000. It turned out to be a positive for the US Dollar. This is indeed a change to recent reactions to positive US data. Over the past few months we were seeing quite the opposite reaction- better than expected data increased risk sentiment and saw investors sell the haven US Dollar. GBP/USD has fallen further overnight and is still partly reeling from the Bank of England decision to increase quantitative easing by ?50 billion to ?175 billion. It opens this morning at 1.6625 - a sharp correction from the 1.7000 highs of last week. Data is lacking today but what will be crucial to the direction of GBP/USD over the next few days will be the Bank of England Inflation Report due on Wednesday.
- We expect a range today in the GBP/USD rate of 1.6580 to 1.6690
:: Euro: The Euro has also fallen sharply against the US Dollar. It traded above 1.4350 pre US NFP release but gapped lower following the news. It fell to a low of 1.4165 in reaction to the better than expected data and opens this morning at 1.4190. German Industrial Production did not help the Euro''s cause either coming in at -0.1% vs. forecasts for 0.6% rise. EUR/USD opens this morning at 1.4190. GBP/EUR has recovered a bit and is back above 1.1700 this morning - it trades at 1.1720 currently.
- We expect a range today in the GBP/EUR rate of 1.1680 to 1.1760
:: Aussie and Kiwi Dollars: The Australian Dollar and New Zealand Dollar are little changed against the Greenback. As equity markets reacted positively to the US jobs data investor demand for the high yielding and riskier currencies also increased. AUD/USD continues to trade close to .8400 whilst NZD/USD, having made a brief but failed attempt to push through .6800 opens at .6735. There is little by way of data due from either Oz or NZ tonight - perhaps some profit taking on equity markets will see some profit taking on long AUD and NZD positions, but overall both currencies are expected to remain firm. As they do both GBP/AUD and GBP/NZD have fallen further. GBP/AUD opens at 1.9810 whilst GBP/NZD trades at 2.4670.
- We expect a range today in the GBP/AUD rate of 1.9760 to 1.9910
- We expect a range today in the GBP/NZD rate of 2.4580 to 2.4740
:: Data Releases:
AUD: No data due for release today
EUR: Sentix Investor Confidence
GBP: BRC Retail Sales, RICS House Price Balance
NZD: No data due for release today
USD: No data due for release today
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