Daily Currency Forecast For The Pound Sterling, New Zealand Dollar, US Dollar and Euro

Modified: Friday, 2 March 2012 16:15 BST - Written by David Woodsmith

STORY LINK Daily Currency Forecast For The Pound Sterling, New Zealand Dollar, US Dollar and Euro

The market was surprised by some strong UK Manufacturing sector data earlier today. The PMI Construction sector survey showed a strong increase in activity last month, taking the POUND STERLING higher across the board. Sterling positivity will be tested the release of the PMI Services survey on Monday morning – until then, Sterling is likely to trade to a NEUTRAL TO POSITIVE bias.

It was a good news/bad news session for the EURO. 25 of the 27 member states of the eurozone signed a new fiscal compact earlier today, formulising the budgetary restraints upon individual European counties. On the debit side, Spain’s new Prime Minister, Mariano Rajoy, revealed earlier today that the debt-burdened Iberian state is set to miss its budget target for the year. This leaves the euro trading on a NEUTRAL TO NEGATIVE footing. The current GBP EUR exchange rate is 1.2009.

Risk was once again off the menu today, as investors expressed their concerns that the ‘fiscal compact’ signed by eurozone leaders in Brussels earlier today, will not have sufficient clout. This saw the US DOLLAR make pronounced gains against the euro and the Pound Sterling, taking the GBP USD exchange rate all the way down to 1.5838. This afternoon’s better than anticipated Canadian monthly GDP figure has the potential to improve sentiment, meaning that the Greenback ends the week with a NEUTRAL TO POSITIVE outlook.

The NEW ZEALAND DOLLAR has shown signs of easing in the market during recent sessions. This has taken the GBP NZD exchange rate to its current level of 1.9026. The Kiwi has been hard-hit by the shift out of risk over the past 48hrs. Yesterday’s comments by US Federal Reserve Chairman Ben Bernanke suggesting that America’s labour market conditions remain ‘far from normal’ caused appetite for risk to seep from global markets, meaning that the Kiwi finishes the week trading to a NEUTRAL TO NEAGTIVE bias.

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