Monday, 1 Mar 2010

The Pound Reaches a 9-Month Low against the Dollar

The Dollar continued to rise against the Pound during today's trading session. GBP/USD fell to the 1.4775 level, marking a 9-month low. The Dollar also strengthened against the Euro today.

The Pound's downfall against the major currencies today came as a result of British polls which showed that Britain could have its first minority government since 1974, which may damage efforts to reduce the nation's debt. The Dollar rose today as manufacturing in the U.S. has expanded for the seventh consecutive month. The end result showed that the manufacturing index failed to reach the expected level of 57.7, yet the 56.5 result still has shown that factories are leading the U.S. economic recovery. Generally speaking, any result above 50.0 indicates that the industry is expanding.

Looking ahead toward tomorrow, the most interesting economic publication looks to be the Canadian Interest Rates announcement, scheduled for 14:00 GMT. Current expectations suggest that the Bank of Canada (BOC) will leave rates at 0.25%. However, if the BOC will surprise and hike rates, CAD will likely see gains.