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A surprisingly upbeat update for GBP this week with good levels across the board despite last weeks confirmation of being in a double-dip recession.

£/€
Range of the week: 1.2196 – 1.2325
Variance of the week on £10k=€ 129


Major news or data for the week so far;

GBP continues to dominate this cross this week, with levels pushing to a fresh 22month high this morning.
Euro zone figures again disappointing with confirmation that the Spanish economy contracted by 0.4pc for the first 3 months of the year and by 0.3pc in the final quarter of last year.
We also saw German retail sales (YoY) being released at 0.5pc versus expectations of 2.3pc. As the ‘powerhouse’ of the Euro zone expect the market to be sensitive to any negative news from the Germans.
Fundamentally the Euro zone still has its problems and these seem to outweigh the fact that the UK is back in a recession, hence the reason why rates remain supported at high levels.
Of note this week we have the ECB rate decision and a speech by ECB President Mario Draghi tomorrow.

£/$
Range of the week: 1.6176 – 1.6300
Variance of the week on £10k=$:124


Major news or data for the week so far;
Dollar weakness was the main driver as Fed Chairman Ben Bernanke left the door open for further monetary stimulus last week. High unemployment levels in the States remain a concern to the FED. On the back of this GBP rose to a 8 month high on Monday this week and still finds itself towards the higher levels of this range.

£/AUS
Range of the week: 1.5556 – 1.5731
Variance of the week on £10k=AUS 175


Major news or data for the week so far;

The RBA shocked markets overnight Monday by cutting interest rates by 0.50pc this was the largest interest rate cut by the RBA since February 2009 and takes the official rate to 3.75pc from 4.25pc. RBA governor Glenn Stevens said that a lower inflation outlook provided the scope to cut the cash rate and help stimulate the economy.

Markets had expected a 0.25pc cut but not the .50pc figure so the pound is currently enjoying year to date high’s against AUD.


£/NZD
Range of the week: 1.9762 – 1.9974
Variance of the week: on £10k=NZD212


Nothing much to note in this pair, following the general trend of GBP strength against all commodity currencies at present.


£/ZAR
Range of the week: 12.502 – 12.642
Variance of the week: on £10k=ZAR 1400


£/CAD
Range of the week: 1.5939 – 1.6069
Variance of the week: on £10k=CAD130


GBP tested the year high earlier this week on release of disappointing GDP figures for Canada. Official figures for the 1st quarter of 2012 were released at 1.6pc which disappointed a market anticipating 2.1pc growth. GBP failed to breach the 1.60 psychological level for any length of time and still trades under here as the comparison with disappointing economic growth in Canada, and economic contraction in the UK, limits gains.
 
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