Thurs Feb 14th report

CURRENCY
RATE
EURGBP
Euro - Sterling
0.7334
GBPEUR
Sterling - Euro
1.3325
GBPUSD
Sterling - US Dollar
1.9480
EURUSD
Euro – US Dollar
1.4467
GBPAUD
Sterling - Australian Dollar
2.1563
GBPNZD
Sterling - New Zealand Dollar
2.4794
GBPCAD
Sterling - Canadian Dollar
1.9410
GBPZAR
Sterling - South African Rand
14.891
EURSEK
Euro - Swedish Krona
9.3399
EURDKK
Euro - Danish Krone
7.4517
EURNOK
Euro - Norwegian Krone
7.9597
GBPSEK
Sterling - Swedish Krona
12.5719
GBPDKK
Sterling - Danish Krone
10.0384
GBPNOK
Sterling - Norwegian Krone
10.7199
GBPJPY
Sterling – Japanese Yen
213.18

INTEREST RATES

UK
Base Lending
5.25
USA
Base Lending
3.00
EUROPE
Base Lending
4.00

Annual Euribor
4.75

Monthly Euribor
4.29

3 Month Euro Libor
4.78

6 Month Euribor
4.79

IRPH
5.56

Latest Market News

British Pound Extends Gains Against the US Dollar

Yesterday saw the British pound extended its gains against the US dollar thanks to stronger than expected employment numbers and a mildly hawkish quarterly inflation report.

In contrast to the declines in the employment components of manufacturing and service sector PMI, unemployment in January dropped for the 16th month in a row to the lowest level in over 30 years. Despite a slowdown in the housing market and the financial sector, the UK labor market remains strong, offsetting a decline in average earnings growth. The Quarterly Inflation Report was equally bullish for the British pound. Even though BoE Governor King recognized the downside risks to growth, he raised the bank’s inflation forecast and warned that near term inflation will continue to breach their 2 percent goal and runs the risk of breaching the government’s 3 percent limit as well. If inflation rises beyond 3 percent, King would be obligated to write a letter of explanation to Alistair Darling, the Chancellor of the Exchequer and in doing so, it will be difficult for him to justify another rate cut.

Stocks and Currencies Rise on Strong Retail Sales

Yesterday’s volatile trading session caused mixed reactions for the US dollar amid better-than-expected retail sales figures, and helped the US dollar retrace some of its losses against the Euro from Tuesday. The Euro struggled amid fading speculation of a rate cut by the ECB did not support the currency, while the Pound Sterling surged past 1.9600 as unemployment fell to a 33 year record low. The Yen came out as the biggest loser as it fell to a monthly low to trade well into 108.00 as newly released data reflected a jump in bankruptcies with consumer confidence hitting a four year low. Commodity currencies came out mixed in the volatile session as the US dollar strengthened against the Australian and the New Zealand dollar, while the Canadian dollar was able to hold up against the US dollar.

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