US Interest Rates Remain On Hold
It was confirmed last night that the Federal Reserve Bank of America (FED) kept US interest rates on hold as expected. In the same meeting it was also confirmed that it would maintain its current stimulus package leaving the market guessing as to when the FED will begin tapering down their monetary stimulus package. Earlier this year FED Chairman Ben Bernanke stated that with US economic data improving they would start to reduce the amount of money they are pumping into the economy every month, this comment sent the markets into turmoil with some major currency movement which ended up with Bernanke having to back track and state that they will not start tapering immediately. Since then the markets have been looking for any sign that the FED will start to reduce the amount of money they are pumping into the system but there has been no further comments as to when it may begin. So every interest rate decision and comment from Bernanke is now watched more closely than normal and as a result last nights decsion not to amend the stimulus package generated more strength for the USD as it moves closer to falling below the key 1.60 level.
As previously mentioned there are still many problems in America, not least the fact that Obama’s ratings are currently at the lowest they have been in his 2 terms as President but also the impending debt ceiling. As a result there is a chance we will see the Dollar weaken again and push back up to the mid 1.60’s but that may not be in the short term as the current trend of Dollar strength continues.
So, if you need to buy USD then speak to one of our currency brokers today who will be able to discuss your requirements and the market outlook so you can make an informed decision as to when to trade.
Sterling Strength Against the Euro
Yesterday we saw the Pound fight back against the Euro making some small but much needed gains against the single currency. Some positive UK housing data and the fact that Sterling was a little undervalued were possibly the key drivers for the Pound strength. As a result of this movement this morning we are seeing some slightly better rates of exchange, so if you need to buy Euros speak to us today so we can discuss the options available to you which include limit orders. A limit order allows clients to target a rate of exchange that may not currently be available by using our advanced systems, this means that should the market spike unexpectedly at anytime of day or night our system can secure the currency for the client at the deired rate. To find out more about this call us today on 01494 725353 or email me directly at firstname.lastname@example.org