Yesterday the GBP/USD suffered sharp losses and hit its lowest level in 6 years. The Cable lost 3.7% to end the day at $1.4893. The British Pound has been badly hurt the past five months from an economy that is operating in a recession and sharp cuts in Interest Rates by the Bank of England (BoE). BoE Governor Mervyn King yesterday said the drop in the Pound does not come as a surprise, and only further losses could spark a currency concern for the BoE. He also openly endorsed a policy for the further easing of Interest Rates to combat a recess... ( read more )
Archive for November, 2008
November 12, 2008 - The EUR/USD Breaks Significant Support Levels
The USD saw a bullish trading session versus most of its major currency crosses yesterday. The USD took advantage of the falling Crude Oil Prices, which reached a 20-month low, and some bearishness by its counterpart currencies. Against the EUR, the USD reached its highest value in more than a week as the pair traded under the significant price barrier of 1.2500 towards the end of yesterday's trading session. The greenback experienced similar behavior against the British Pound and Swiss Franc.
Concerns that the deepening global economic cri... ( read more )
Nonfarm Payrolls On Tap
The markets were being driven yesterday by huge swings in European Interest Rates. The moves came from the Bank of England (BoE) and the European Central Bank (ECB). The BoE slashed their benchmark Interest Rate by 150 basis points. This was 100 points more then the market had forecasted. Their intent is to boost economic growth and reduce the likelihood of a prolonged recession by stimulating consumer spending and reducing mortgage rates.
The GBP/USD shed almost 150 pips and came very close to an intra-day low of the 1.5500 mark. The green... ( read more )
November 5, 2008 - Obama’s Victory Takes the USD Further Up
With a relatively negative news day from United States, which saw US factory orders in September dropping more than three times what was expected, the USD recorded one of its biggest one day slides against the EUR experienced since that currency's launch. The USD witnessed similar behavior against the Pound and Swiss Franc. The USD did see bullishness as well, as it gained around 100 points against the JPY and closed at 99.60.
The recent unusual price movements have been in response to new market conditions stemming from the global financia... ( read more )
November 4, 2008 - US Election Day Takes the USD Up
On the eve of the U.S. Presidential election, the Dollar posted large gains of 150 points to close at 1.2580 against the EUR, helping to erase some of its losses from late last week.
The Dollar continued to shrug off poor economic data stemming from the U.S. economy as the Institute for Supply Management released the Manufacturing Purchasing Manager survey. The survey came in below the forecasted value, displaying an overly pessimistic view of the U.S. manufacturing industry. This was one of the worst outlooks in the survey's history, addin... ( read more )