BBVA Estimates That Spain?s Banks Require A Further ?60bn Of Bailout Funding, GBP EUR Rate Holds Steady

September 21, 2012 - Written by John Cameron

STORY LINK BBVA Estimates That Spain?s Banks Require A Further ?60bn Of Bailout Funding, GBP EUR Rate Holds Steady

This morning’s UK Public Sector Borrowing figures for last month were marginally less appalling than analysts had been anticipating. This caused a small move forward for the Pound against most of the other majors – the notable exceptions being the high-yielding Australian and New Zealand Dollars. Other than that, today has been relatively short of risk events of note until this afternoon’s Canadian inflation numbers. The CPI data revealed that domestic prices rose at a higher annualised pace than had been expected in Canada last month, stoking market whispers that a rate hike might be forthcoming from the Bank of Canada sooner rather than later. The news has not stopped the GBP CAD exchange rate heading slightly northwards on the session; GBP CAD is currently trading at 1.5861. However, the pair has come a long way in a relatively short space of time, so a technical retracement, triggered by this afternoon’s Canadian inflation data, looks a distinct possibility.

Elsewhere, there was further worrying news for the euro today, as Spain’s second largest lender, BBVA, revealed that it believes that a further €60bn in bail-out funding will be required in order to prop up the collective balance sheets of the debt-troubled Iberian state’s banking sector. The single currency has held steady on the day, in spite of the news, with the GBP EUR exchange rate currently tipping the scales at 1.2505. However, the euro may not fare so well if independent stress tests on Spanish banks, due for release later this month, come to the same conclusion as BBVA.

Looking ahead to next week, the key release for investors holding Sterling comes on Thursday, with the finalised version of the UK’s Q2 GDP growth numbers. Unfortunately, a disappointing showing once again appears the most likely outcome for this piece of data.

International Money Transfer? Ask our resident FX expert a money transfer question or try John's new, free, no-obligation personal service! ,where he helps every step of the way, ensuring you get the best exchange rates on your currency requirements.

TAGS: Currency Predictions Euro Forecasts Euro Pound Forecasts Pound Euro Forecasts