16° Partly Cloudy
Hi: 16° Lo:10° 7 day
Hi: 16° Lo:10° 7 day
The euro was squarely in the bottom half of the league last week. It lost half a cent to the pound and more than one and a half to the US dollar.
It was not that investors took against the euro, more a matter of them craving the perceived safety of the dollar. A compromise budget deal in the US Congress brought initial relief that the American economy was not about to fall off the "fiscal cliff" but, upon closer examination, it became clear that the danger point had only been postponed, not dismantled.
The mood changed on Friday, after strong employment data reminded investors that the US economy was actually doing reasonably well and that they really need not be so worried, but the damage had been done. The pound also lost ground to the dollar last week but it did not lose so much of it, hence the lift for sterling/euro.
US developments were the biggest influence on currencies last week, with the dollar leading the way for much of the time. It gained more than a cent and a half against the euro and slightly less than that against the pound.
It was not that investors took against sterling, more a matter of them craving the perceived safety of the dollar. A compromise budget deal in the US Congress brought initial relief that the American economy was not about to fall off the "fiscal cliff" but, upon closer examination, it became clear that the danger point had only been postponed, not dismantled.
The mood changed on Friday, after strong employment data reminded investors that the US economy was actually doing reasonably well and that they really need not to be so worried, but the damage had been done.
The three commodity-related dollars were closely grouped at the top of the league table after last week's efforts. There was almost nothing to choose between the Australian, New Zealand and Canadian dollars. In third place the Loonie strengthened by more than two cents against the pound.
For all three the upward break came when the market reopened after the New Year holiday. It was caused by a last-minute deal in Congress to avert the "fiscal cliff" that had threatened to derail the US economy. Even though the compromise budget bill is woefully incomplete – for example it does not address spending only income tax – investors see a brighter economic future than the one they feared at the end of last year.
Two other factors fed investors' appetite for the commodity currencies. December's US employment report was stronger than expected and the new Japanese government announced ¥12 trillion of measures to stimulate the economy.
The three commodity-related dollars were closely grouped at the top of the league table after last week's efforts. There was almost nothing to choose between the Australian, New Zealand and Canadian dollars. In top place the Aussie strengthened by three cents against the pound.
For all three the upward break came when the market reopened after the New Year holiday. It was caused by a last-minute deal in Congress to avert the "fiscal cliff" that had threatened to derail the US economy. Even though the compromise budget bill is woefully incomplete – for example it does not address spending only income tax – investors see a brighter economic future than the one they feared at the end of last year.
Two other factors fed investors' appetite for the commodity currencies. December's US employment report was stronger than expected and the new Japanese government announced ¥12 trillion of measures to stimulate the economy.
The three commodity-related dollars were closely grouped at the top of the league table after last week's efforts. There was almost nothing to choose between the Australian, New Zealand and Canadian dollars. In second place the Kiwi strengthened by three cents against the pound.
For all three the upward break came when the market reopened after the New Year holiday. It was caused by a last-minute deal in Congress to avert the "fiscal cliff" that had threatened to derail the US economy. Even though the compromise budget bill is woefully incomplete – for example it does not address spending only income tax – investors see a brighter economic future than the one they feared at the end of last year.
Two other factors fed investors' appetite for the commodity currencies. December's US employment report was stronger than expected and the new Japanese government announced ¥12 trillion of measures to stimulate the economy.
This article was provided by Moneycorp who are a Money Transfer specialising in send money abroad.
