Monday, 12 Jul 2010

Pound Falls on Disappointing Growth Data

The Pound fell below $1.50 for the first time in almost two weeks after the release of disappointing growth data for the first quarter. The release of the first quarter GDP data indicated that economic recovery in the U/K may be stagnating and that it remains fragile.

The EUR also declined today after rallying above 1.27$ late Friday after some profit taking by investors and on speculations that stress tests in the Euro-Zone region will not as successful as hoped. Markets are also awaiting the result of another attempt by Greece to raise funds in the open market.

The Yen declined today versus the USD after Prime Minister Naoto Kan's party lost control of Japan's upper house of parliament. This may prove difficult for the much needed economic reforms for the nation and its public debt, the world's largest.

The EUR had fallen back to $1.2570 from $1.2640 late on Friday in New York and to Y111.47 from Y112.07. The USD rose to Y88.90 from Y88.65. The U.K Pound fell to $1.4977 from $1.5066.