FindCurrency.com

By James Matthews

The Dollar has strengthened significantly in the last two weeks from the aforementioned ‘flight to safety’ effect. This has seen the Greenback gain against most major currencies in particular against the vulnerable Euro.

Whilst this continues to lend a hand to Dollar strength the Korean conflict is also creating uncertainty (albeit political and not financial) in the markets. Typically again you may suggest that this may just enhance the flight to safety effect and hence why the Dollar continues to gain. However I don’t think this is the case, as the Americans are becoming embroiled in the dispute it raises questions as to how their recovering economy will cope with another conflict. This could potentially cost the USA billions of dollars, this is very similar to Sterling’s position from the Euro – one which should be positive for the currency but ends up inadvertently costing the economy and thus damaging the currency.

However despite this cost – which also raises questions regarding the status as the US Dollar as a ‘safe haven’ currency I would still expect the Greenback to gain. But why? Gold is the answer. Over and above the Dollar or any other currency the ultimate ‘safe’ investment is Gold. In times of conflict or financial turmoil investors will always flock to Gold and this is priced in Dollars. It is a principal reason that Dollar is a safe haven currency and the main reason I would expect the Greenback to continue to strengthen against most majors.

If you have your funds in Dollars I would expect that your funds may be worth more by the time Santa comes down the chimney this christmas. If you are looking at buying Dollars before Christmas then fill out one of our enquiry forms and make sure your Dollar requirement is purchased before your project becomes unaffordable.

By James Matthews

A host of Canadian data is due for release today at 13.30 (UK time) and is likely to shape the Loonie’s fortunes for the start of the week. Industrial Product Price and Raw Material Index are both set for release along, perhaps most importantly Canadian Current Account data.

The Current Account data is likely to be the most important data set for the CAD today which will preceed GDP figures which is really likely to move markets tomorrow. Data today will show the cash flow of the Canadian account over the last month and is expected to show a further loss from -11Billion to nearly -15Billion. If GDP figures also (as expected) decline tomorrow then the Canadian Dollar could lose against most major currencies throughout this week.

If you have a Canadian Dollar requirement fill out an enquiry form and we will put a specialist Currency Broker in touch.

By James Matthews

The USD had a strong day yesterday gaining against nearly all majors except the Japanese Yen. This strength was seen off the back of positive GDP figures which were released even better than expected at 2.5%. This caused initial strength and the Dollar had further gains reaping the rewards from lost confidence in the Global economy caused by the Irish bailout.

This is the ‘flight to safety’ effect that we see when uncertainty exists in the markets. Yesterday it was very evident of this, as the main three ‘safe’ currencies – the US Dollar, Swiss Franc and Japanese Yen all gained against the majority of currencies. The Euro was the days biggest loser (losing nearly 2% against the US Dollar), but the Greenback also gained over 1% against Sterling. With political unrest now set in Ireland and Portugal and Spain well and truly under the spotlight I would not be surprised if these currencies continued to gain as an overall trend over the next few weeks.

If you have any currency requirement or are looking at buying US Dollars fill in one of our forms and a dedicated account manager will be in touch.

By James Matthews

Both the Canadian and the US Dollar look set to have very busy days in the Currency markets today as a host of data sets are due for release.

Canadian CPI figures are the first data set due for release at 12.00 today (UK time) and could cause serious strength if figures break through the 2% barrier (YoY). Whilst this could get the ball seriously rolling for the CAD we then have Retail Sales figures which are expected to increase. If these are released as good or better than expected then I would expect the Loonie to have a day of serious strength as it heads towards parity against the US and continues to gain against the vast majority of curencies.

The US also can expect a very volatile day with their first data set due for release at 13.30 UK time. The most important data set of the day for the US is likely to be their revised GDP figures, which are expected to be revised up from 1.7% to 2.4%. I would expect this to cause strength to the Dollar as the first installment of QE (being done at $75 billion per month) shows signs of boosting confidence in the economy. Existing home sales are also due out and these are expected to show a slight decline – with these figures due for release at 3.00 UK time it is possible that the Dollar may tail off slightly towards the end of the day. I would expect the Dollar to peak (it has had a fairly positive start to the day) in the afternoon UK time when the US markets open (half past one GMT).

If you do have a Canadian or US Dollar requirement make sure you are in regular contact with a specialist Currency Broker who knows all the details of your specific requirement. Fill in one of our forms and an individual specialist will be in touch.

By James Matthews

Today is a day of speeches as both Ben Bernanke (Chairman of the FED) and Lord Trichet (the ECB president) limber up to deliver their speeches on the outlook of their respective economies.

Bernanke is first to act at 9.15 (UK time) this morning. It will be interesting to see the Harvard Graduate’s perspective on the US QE2 program and the effect that this announcement has had on the Dollar. This could affect rates if he thinks that the introduction of QE has already had a boost on the economy and sees any change on any industries so far (particularly the Housing market).

Perhaps more importantly Trichet’s speech may give us an overview into what he thinks on the Irish situation and how he views the potential bail-out there. The certainty of the handout may help to sure up the Euro as it appears very vulnerable at the moment. As discussed in the last post uncertainty in major currencies has a noticeable impact on the US Dollar, as it’s reputation as a ‘safe haven’ currency has returned now the QE net has been cast. If the bail-out is not made soon and Ireland continue to cast doubt, expect investors to back the US Dollar and for the Greenback to gain against the majority of currencies.

Do you have a requirement that you would like to discuss before the weekend? Get in touch before the end of play at the end of the week to get the ball rolling on your requirement.