GDP figures as expected

UK GDP figures released this morning show a 0.3% growth in the UK economy, for the first quarter of 2010 compared to 2009.

The figures were exactly as expected by analysts, so there has been little effect on the Pound. Exchange rates for buying Euros remain at around the best levels since last summer.

Economic releases this week

This week's data likely to affect exchange rates is as follows; notably UK GDP on Tuesday morning will give an indication of the growth rate in the economy and is very likely to have a strong effect on sterling.

Monday 24th
1500 - US home sales

Tuesday 25th
0400 - New Zealand Reserve Bank inflation report
0930 - UK GDP
1500 - US consumer confidence

Wednesday 26th
0700 - German GfK consumer confidence
1330 - US durable goods orders
1500 - US new home sales
2345 - New Zealand trade balance

Thursday 27th
0815 - Swiss employment level
1330 - US GDP & initial jobless claims

Friday 28th
Overnight - UK GfK consumer confidence
1330 - US personal consumption

Sterling falls

This week has seen a huge flow on the money markets away from AUD and NDZ, which has strengthened both the US Dollar and Euro significantly. The Pound is now trading below €1.15 and $1.45, with no help from economic data showing UK mortgage approvals lower then expected in April.

One piece of good news was that UK public borrowing was £10bn in April, less than the £11.2bn forecast, which has given the Pound a small boost this morning.

For the latest live trading rates for overseas transfers, contact Currency Index on 0800 043 2623.

Australian Dollar rates up 5c

Rates for sending money to Australia have improved dramatically today, after the Reserve Bank of Australia indicated that there will be no further interest rate rises for the time being.

Interest rate rises tend to keep currencies expensive, so when interest rates stop going up, a currency can become cheaper accordingly.

Those of you looking to move down under or transfer funds to Australia in the coming weeks and months should follow the rate closely for opportunities to buy.

Inflation hits 17-month high

This morning's UK inflation figures showed a rise to 3.7%, higher than analysts expected and the highest UK inflation for over a year.

Although this means the Bank of England might need to raise interest rates sooner than might have been the case, which would normally give the Pound a boost, the news has not been taken well, because it puts the Bank's predictions of inflation to come back down to its target levels in the shade.

Sterling has therefore actually fallen slightly on the news.

Tomorrow morning's interest rate minutes from the Bank of England will now be of increased interest for the Pound's fortunes.

This week's economic data

A very busy week ahead with key inflation data out in the UK, Europe and the USA, all likely to affect exchange rates this week.

Keep in touch with Currency Index for the latest news affecting your currency purchase.

Monday 17th
No major data

Tuesday 18th
0230 - Australian interest rate minutes
0930 - UK CPI & RPI inflation
1000 - Eurozone CPI inflation & trade balance; German economic sentiment
1330 - US housing starts & PPI inflation

Wednesday 19th
0030 - Australian consumer confidence
0930 - Bank of England policy minutes
1330 - US CPI inflation
1700 - European Central Bank speech
1900 - US interest rate minutes

Thursday 20th
0700 - German PPI inflation
0930 - UK retail sales
1330 - US jobless claims

Friday 21st
0700 - German GDP
0900 - German IFO business survey
1200 - Canadian CPI inflation
1330 - Canadian retail sales

UK Trade Balance worsens

Yesterday's UK trade balance figures have hurt the Pound, as data showed a £3.6bn defecit for March, against analysts' expectations of £2.4bn.

Sterling remains vulnerable to further losses as the dust settles after the election and the new government faces up to the economic challenges ahead. There is no major data due out in the UK today.

David Cameron is Prime Minister

The political events of last night, confirming David Cameron as Prime Minister at the head of a Conservative-Liberal coalition, have given the Pound a boost. We now have the best rate for buying Euros since June 2009.

Today's Bank of England Inflation Report, published at 10.30, will give some insight into the UK economy and the Bank's forecasts for inflation for the rest of the year. It is a potential 'banana skin' for the Pound - any downbeat news could bring exchange rates down in the current volatile environment.

Quarterly inflation report tomorrow

Tomorrow sees the Bank of England's quarterly inflation report published - a major insight into the strength (or otherwise) of the UK's economic recovery, and prospects for inflation and interest rates in the coming months.

The Pound is certainly vulnerable to poor economic figures at the moment, with the continuing uncertainty around who will be in government. At the same time, the European Central Bank is propping up the Euro with a comprehensive rescue package for Greece.

If you are concerned about the current volatility in the foreign exchange markets, speak to Currency Index about your options.

Election, Greece and this week's currency news

A week is a long time in the currency markets - on Thursday we saw fluctuations of 5c for the Euro and Dollar exchange rates as the election results came in, and the economic crisis in Greece worsened.

This week, much will depend on whether there is a deal between the Conservatives and Liberal Democrats, as well as the Greek bailout, particularly if you are buying Euros to transfer abroad.

We also have the following data due out around the world:

Monday 10th
0700 - German trade balance
1200 - UK interest rate decision

Tuesday 11th
0700 - German CPI inflation
0930 - UK industrial production

Wednesday 12th
0700 - German GDP
0930 - UK jobless claims change
1000 - Eurozone GDP
1030 - Bank of England quarterly inflation report
1330 - US trade balance
1900 - US monthly budget statement

Thursday 13th
0230 - Australian unemployment rate
0930 - UK trade balance
1330 - US jobless claims
2345 - New Zealand retail sales

Friday 14th
1330 - Canadian manufacturing data
1330 - US retail sales

Pound slumps on hung parliament

The Pound's recent gains have been wiped out this morning as the UK election produced a hung parliament.

Those of you buying Euros or US Dollars have seen rates fluctuating up to 5c since the early hours of the morning.

This could spell the end of sterling's recent rise, depending on how quickly a government is formed and how stable the markets perceive the resultant deal.

Best Euro rate since August, but election looms

Further worries on the economic problems in Greece and Spain have weakened the Euro, which is now trading at the best rate for sending Euros abroad since August last year.

With the UK election looking tomorrow and the uncertainty around the result, today may be a good time to look at securing your rate. Don't forget you can fix a rate up to 2 years in advance with Currency Index.

Currency news from around the world

The UK election will be the main point of interest this week - will a hung parliament cause the Pound to drop? There is also news due out from around the world as follows:

Tuesday 4th
0530 – Australian interest rate decision
0930 – UK individual lending & purchasing inflation
1500 – US pending home sales

Wednesday 5th
1000 – Eurozone retail sales
1315 – US employment change
2345 – New Zealand unemployment rate

Thursday 6th
UK general election
0230 – Australian trade balance & retail sales
1245 – Eurozone interest rate decision
1330 – US initial jobless claims

Friday 7th
0230 – Australian monetary policy statement
0930 – UK PPI inflation
1200 – Canadian unemployment rate
1330 – US non-farm payrolls & unemployment rate