Dear Subscriber, Please find below today's update which gives you an insight into the current market conditions, enabling you to keep informed and up to date on the latest currency movements. GBPEUR/GBPUSD The Pound has pushed to a five month high against the U.S Dollar and achieved a fresh 19-month high versus the Euro, peaking at 1.2250 yesterday afternoon, as demand for Sterling continued to rise as a hedge against the ongoing turmoil in the Euro-zone. The UK currency advanced to 1.6070 versus the U.S Dollar, before retreating back towards the first point of support just above the pivotal 1.60 level. UK monetary policy remained a key focus following Wednesday's Bank of England minutes. MPC member Adam Posen, who surprisingly withdrew his recommendation to increase quantitative easing this month despite being the most dovish member of the committee over the past 6-months, confirmed yesterday that he had taken a different stance than that in 2011. His comments reduced fears of a sharp deterioration in economic conditions, amid widespread optimism that the recovery is back on track following positive PMI readings on manufacturing, services and construction. Posen also stated that the UK economy was stronger than would be registered in the official growth data. The market is waiting eagerly for the first quarter GDP figures to be released over the coming weeks. The banking sector will remain an important focus and there will be unease if there is a wider deterioration in European debt-conditions. The Pound for now is able to enjoy it's defensive role and despite the threat of contagion from the Euro-zone, the UK currency is becoming an increasingly attractive commodity for investors. The Pound is also gaining ground versus the higher-yielding currencies, rising through 1.55 versus the Australian Dollar, as speculation mounts that the Reserve Bank of Australia will cut interest rates again at the beginning of May. The Aussie and the Kiwi are both poised to record a weekly loss, amid concern that European leaders are struggling to contain the debt crisis, which is reducing demand for the riskier assets. EUR/USD The Euro found a degree of support in the region of 1.31 against the Dollar and strengthened into the Spanish bond auction, amid a sense of optimism that investor demand would increase. After the initial spike higher, the Euro was subjected to heavy selling pressure yesterday afternoon, as there was an underlying lack of confidence in the Euro-zone outlook. There are concerns over the Spanish banking sector and rumours of another French credit rating downgrade. There was also a report from Moody's Investors Service that Spanish and Italian borrowing costs were already at unsustainable levels from a medium-term perspective. The pressures within the banking sector could destabilize the Euro-zone economy and the Euro retreated to lows close to 1.3070. In the U.S, the weekly jobless claims was again weaker-than-expected with a figure of 386,000 in the latest week from a revised 388,000 previously, which was the highest level since January. Elsewhere, the existing home sales data was also weaker-than-expected with sales dropping to an annual rate of 4.48 million, from 4.60 million previously. If you need any further assistance, or require a live dealing quote - please do not hesitate to contact me on 01736 335250 or send an email to info@torfx.com Regards,
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