Singapore Dollar Makes Gains As Greek Opinion Polls Suggest Pro-Bailout Victory, Sterling Remains Under Pressure

Modified: Monday, 28 May 2012 16:01 BST - Written by David Woodsmith

STORY LINK Singapore Dollar Makes Gains As Greek Opinion Polls Suggest Pro-Bailout Victory, Sterling Remains Under Pressure

Today’s session in the currency markets has been marked by a paucity of data releases, due to a public holiday in most parts of the Western world. This has meant that stock market movements have had a key bearing on price action for most of the major pairs. Gains for Asian indices overnight have ensured that levels for the US Dollar slipped during this morning’s session. The move against the Greenback has been continued this afternoon, with European stocks registering moderate gains.
With no key data due out of the UK until Wednesday morning, the Pound has suffered from a pronounced drift on the day. Predictably, last night’s British house price data did little to buoy Sterling. With last week’s disappointing British retail sales and GDP data fresh in investors’ minds, this week could be a difficult one for the Pound.
The signs remain negative for the euro, as concerns grow over Spain’s troubled banking sector. These fears have caused Spanish/German bond spreads to soar to their highest level since the instigation of the euro in 1999. Tomorrow afternoon’s German inflation data will be closely-watched for any indication that the ongoing eurozone debt crisis is starting to effect the region’s prominent economy, but the major driver for the single currency comes in the middle part of next month with the re-run of Greece’s general election.

The Singapore Dollar remains highly sensitive to risk, which means that today’s opinion polls from Greece which showed a renewed surge of support for pro-bailout parties, was good news for investors holding the SGD. With Asian stocks making respectable gains last night, the GBP SGD exchange rate is threatening a break below 2.0000:1.

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