Weekly Currency Update GBP/USD - Week ending 29th January

Hi All,

As promised here’s a brief update on what’s been happening with the US Dollar over the last week.

While the US saw a significant uptick in the capital inflows during the month of November, it did little to
sway traders appetite for risk. Instead it was politics which dominated the headlines as the week
concluded. On Thursday President Obama announced a plan for sweeping reforms of the banking sector. At its very core it is to create less risk within the financial community although some viewed it as just another method of the Government trying to control the capital markets. In essence the reforms
would prevent banks owning or sponsoring hedge funds as well as limiting proprietary trading to activities
only belonging to customers needs. This would certainly revolutionize the financial community.

Finally Fed Chairman Bernanke's appointment for his second term was delayed as in house conflicts questioned his re-appointment. The market did not react kindly as US equities sold off as a consequence. This week we have an interest rate decision where a no change is expected, however look for any commentary surrounding a time frame for the potential withdraw of stimulus. Additionally, this Friday’s Non-farm Payrolls will also dominate attention along with more quarterly earnings from US blue chip companies.


GBP/USD movement – High’s & Low’s of last week (25-01-10 to 29-01-10)

High’s: 1.6278
Low's: 1.5979

A movement of 1.87%

Difference on £200,000

High: $325,560
Low: $ 319,580

Difference of: $5,980

Whilst FX isn't the most thrilling of subjects, the sooner you begin to think about your money transfers, the more likely you are to make your money go further.

Regards

Mark Bodega
Director - HIFX