Sterling takes hit on jobs data
Quote of the day: “Yesterday is history; tomorrow is a mystery. Today is a gift, which is why we call it a present.”
August 12th: Highlights
- GBP/EUR dives by around -0.9% this afternoon
- GBP/USD trading around 1.5607
- British jobs data results largely negative
- Greece faces recession amid two year cuts
- Aussie Dollar slides as China devalues Yuan
Sterling Comment
GBP/EUR is currently trading in the region of 1.3964, not helped by a largely negative set of British jobs data. The pair dived by approximately -0.9% this afternoon. Unemployment increased by 25,000 between April and June. Euro appreciation can also be attributed to a feeling that we’re nearly there on terms of the international bailout package. Agreements have been made ‘in principle. More on this below. GBP/USD was trending within a tight range this afternoon, the pair now at 1.5607.
Greece
The Greek economy is likely to shrink by 2.3% this year, followed by a 1.3% contraction next year. A two year recession is on the cards as it begins to roll out deeply painful budget cuts and policy overhauls imposed by it’s $86 billion international bailout, according to officials today at the European Union.
Once more than 40 new laws are passed in Athens tomorrow, Eurozone Finance Ministers will decide if Greece gets it’s first tranche of loans in time for it’s 3.2 billion Euro payment to the ECB on August 20. The ministers will get together in Brussels at the end of the week.
Global Comment
The Aussie Dollar (AUD) has been hit against most of it’s major rivals by the announcement from the People’s Bank of China yesterday that it was cutting the value of the Chinese Yuan by almost 2%. This is not good news for exporters down under as it will cause an immediate increase in the price of Australian goods in China’s burgeoning domestic market. GBP/AUD is currently trading around 2.1238.
USD/CAD exchange rates dropped to one and a half week lows, as markets were getting to grips with news of China devaluing its currency for the second consecutive day. The pair hit 1.2955 during early US trade, the pair’s lowest since July 31.
Have a great day!
Morning mid-market rates – The majors
GBP > USD 
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