Australian & New Zealand Dollar Exchange Rate Steady, Pound Dollar Edges Upwards

Modified: Wednesday, 10 July 2013 14:36 BST - Written by John Cameron

STORY LINK Australian & New Zealand Dollar Exchange Rate Steady, Pound Dollar Edges Upwards

After three consecutive sessions of gains, global stock markets have taken a backward step so far today as investors express their fears regarding evidence of a renewed slowdown in China’s vast manufacturing-led economy. Last night’s Chinese import / export figures showed at a considerably lower level than had been anticipated by analysts. The annualised level of shipments into Asia’s premier economy last month shrank by 0.7% versus an expected increase of 6.0%, while the volume of exports out of China were similarly disappointing.

Surprisingly the commodity Dollars have held up reasonably well so far today in spite of the disappointing Chinese numbers. The Pound to Australian Dollar exchange rate (currency : GBP AUD) currently sits just below the 1.6200 threshold, while the Pound to New Zealand Dollar exchange rate (currency : GBP NZD) is threatening to break back through the 1.9000 level. The Pound to Canadian Dollar exchange rate (currency : GBP CAD) has gained a limited amount of ground on the Chinese release. The forward moves for GBP AUD and GBP NZD would surely have been of a greater magnitude were it not for the continued negativity surrounding Sterling following last Thursday’s negative ‘forward guidance’ statement from the Bank of England.

Elsewhere, the Pound to US Dollar exchange rate (currency : GBP USD) has edged higher on the day, moving to an intraday high of 1.4922 earlier. The forward shift for Cable comes ahead of this evening’s all-important Federal Reserve FOMC minutes which will give investors further guidance on the future direction of America’s monetary policy. The fact that market participants are moving out of Dollar-denominated assets in the lead-up to the publication hints that the minutes may suggest that a tapering of Quantitative Easing in the States is still a fair way off. If this does prove to be the FOMC’s line of thinking, then expect GBP USD to head northwards towards the psychologically key 1.5000 threshold later today.

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