Pound to Dollar Exchange Rate Today - GBP USD Recovers, GBP EUR Edges Lower On Greek Debt Deal

January 24, 2012 - Written by Tim Boyer

STORY LINK Pound to Dollar Exchange Rate Today - GBP USD Recovers, GBP EUR Edges Lower On Greek Debt Deal

The Pound Euro exchange rate (GBP EUR) is 1.1952. The Pound Dollar exchange rate (GBP USD) is 1.5552. The Pound Australian Dollar exchange rate (GBP AUD) is 1.4844. The Pound New Zealand Dollar exchange rate (GBP NZD) is 1.92054. The Sterling Rand exchange rate (GBP ZAR) is 12.39923.

The major overnight news in the currency markets once again focuses on Greece’s ongoing debt problems.

Reports have emerged in the last few hours from the Eurozone Finance Ministers’ meeting in Brussels, regarding the terms of negotiations between Greece’s creditors and the assembled policy-makers. It appears that the deal between Greece and the institutional investors to which it owes tens of billions of Euros, will see an extension of the term of the creditors’ debt. The proposed refinancing will see new Greek bonds, with a longer maturity date, being issued. The argument between the Eurogroup and Greece’s creditors centres on the yield on these new Greek bonds, with Greece’s creditors demanding a 4% return – a yield which the Eurozone Finance Ministers are unwilling to consent to.

Comments from Jean-Claude Juncker, President of the Eurogroup, earlier this morning, suggested that the European policy-makers’ position is entrenched. Juncker once again called for Greece’s creditors to accept a lower interest rate on the new Greek bonds. The ongoing impasse has failed to damage the Euro since the start of this week’s session – the GBP EUR exchange rate dipping down to 1.1928 overnight, its lowest level since the week between Christmas and the New Year.

Meanwhile, the price of a barrel of crude oil was on the march yesterday, following fears over the effect that this week’s EU embargo on Iran would have on the global supply of crude. EU Foreign Ministers formally accepted the embargo yesterday in order to punish Iran for its ongoing nuclear programme. The EU currently purchases roughly one fifth of Iran’s oil output. Iran responded to the embargo by threatening to close the strait of Hormuz, through which 20% of global oil supplies pass.

Fears over future oil supplies could hit the US Dollar particularly hard, as the US economy is the largest net consumer of crude oil in the world. This could see the GBP USD exchange rate move further away from its 17-month low of 1.5235 from earlier this month.

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