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Daily Forex Commentary
Friday, 3 October 2008 - Market Commentary:: United States Dollar: GBP/USD traded to a high of 1.7734 overnight. It opens this morning at 1.7690 after trading just shy of the 1.7700 figure for much of the European session on Thursday. It is a busy day today. The House of Representatives is due to vote on Fed bail out plans this afternoon and US Nonfarm Payrolls data is also due for release. A historic and potentially volatile day lies ahead. Over the morning, it seems as though GBP/USD may trade steadily about the 1.7700 figure, although this may be a brave suggestion given recent volatility. UK Purchasing Manager Index Services is due for release this morning.
- We expect a range today in the GBP/USD rate of 1.7580 to 1.7720
:: Euro: As expected, the ECB voted to leave interest rates on hold yesterday at 4.25%. In a change of tone, ECB President Trichet told the conference that members had discussed an interest rate cut, but he also acknowledged that even though inflation was showing signs of easing, threats to upside risks still existed. Overall it was a dovish tone and the Euro was sold on the back of it. EUR/USD fell to a low of 1.3775 yesterday as markets continue to fret over the prospect of Eurozone banks falling into deeper trouble too. The sell off in the single currency has meant that GBP/EUR has pushed steadily higher over the last 24 hours. It opens this morning just shy of the 1.2800 figure at 1.2760.
- We expect a range today in the GBP/EUR rate of 1.2680 to 1.2810
:: Aussie and Kiwi Dollars: AUD/USD and NZD/USD have been in steady decline in the last 24 hours. AUD/USD fell to a low of .7713 overnight whilst NZD/USD dipped to a low of .6560. Risk appetite and aversion have bumped both currencies around over the past few weeks and will continue to do so until at least the Fed bail out plan is passed. Both AUD/USD and NZD/USD have recovered slightly off of their lows this morning; though these steady declines have meant that both the GBP/AUD and GBP/NZD cross rates have pushed higher. They open at 2.2750 and 2.6650 respectively.
- We expect a range today in the GBP/AUD rate of 2.2500 to 2.2820
- We expect a range today in the GBP/NZD rate of 2.6480 to 2.6800
:: Data Releases:
- AUD: No data due for release today
- EUR: Retail Sales
- GBP: Purchasing Manager Index Services
- NZD: No data due for release today
- USD: Nonfarm Payrolls, Unemployment Rate
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