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 rallied by the most this month against the U.S Dollar and also rose versus the Euro, along with a number of currencies, after a report from the British Retail Consortium showed that a gauge of UK retail sales increased beyond initial estimates in March. The UK currency also found buying support, as global stock market gains boosted the appeal of higher-yielding assets and reduced the demand for the Dollar as a haven. The latest in a good run of positive economic reports also supports the Pound, especially considering its position outside of the Euro-zone, as an alternative to euro-denominated assets. The Pound also rallied against the South African Rand and Australian Dollar. The benchmark FTSE 100 Index was up 0.7% by midday in London, bouncing back from a 2.2% decline on Tuesday. It now seems increasingly likely that the UK economy will avoid a technical recession in the first quarter with the economy expected to expand between 0.1 and 0.3% in the first three months of the year. The Pound was able to find support just under 1.59 against the U.S Dollar and continued to trend higher through the course of the day. Markets have taken a slightly more optimistic tone surrounding the UK economy and that is likely to underpin Sterling sentiment over the coming days. There was, however, relatively weak demand at the latest bond auction, which suggested limits to Sterling demand at lower yields. The UK currency has begun the day firmly on the front foot, amid reports of sovereign interest for the Pound. The Pound lost ground against the higher-yielding currencies overnight, as an increase in U.S and Asian stock markets improved demand for the Australian and New Zealand Dollars, alongside the South African Rand. The Kiwi bounced back strongly after data showed an improvement in business confidence for the first quarter, adding to signs that the economy is proving resilient. EUR/USD The Euro initially consolidated in the region of 1.31 against the U.S Dollar and pushed higher ahead of the U.S open in volatile trading conditions. There was another increase in Italian bond yields at the latest bond auction but the markets were primarily focused on the longer-term bond yields. After the spike higher the previous day, there was a sharp drop in Spanish yields, which helped stabilize market sentiment. There was also some speculation that the ECB could re-start its bond-purchasing program and that too provided an element of stability. The improvement in global risk appetite also helped limit defensive demand for the Dollar as a safe haven and the Euro subsequently bounced back through 1.3150 on the day. However, this may be a temporary reprieve with continuing fears over the Spanish outlook. U.S economic data was thin on the ground yesterday with no major releases through the day. Markets will remain on high alert over comments from Federal Reserve officials over the coming days, considering the uncertainty over policy outlook. The Euro retreated back towards 1.31 against the Dollar over-night, before recovering this morning on firmer risk appetite. 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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