GBP losing streak against USD

September 7th: Highlights

• Sterling drops Friday
• China trims GDP growth estimate
• Poor US employment data
• Kiwi Dollar slips
• Aussie dollar rises against USD

Sterling Comment

On Friday, the British Pound completed its longest losing streak against the US.Dollar since the global financial crisis in 2008. “Sterling has taken quite a hefty whack,” said Steve Barrow, head of Group of 10 strategy at Standard Bank, who still views Sterling as rising about 10% over the coming couple years, forecasting that UK growth will outpace its European neighbours. GBP/USD fell last week, lengthening its weekly decline to 1.3%, to 1.5193. The pair opens this morning trading up at 1.5230.

Over the past few weeks GBP/EUR has lost in the region of six cents. Sterling decreased last week 0.7% to 1.3667 against the Single Currency as of 5pm on Friday. The five week decline was its longest since July 12 2013. GBP/EUR is now moving around 1.3654.

German retail sales for July posted at 3.3% instead of 1.7%. Adding to the strength of the Single Currency was a better than anticipated Eurozone inflation rate, which held at 0.2% instead of dropping to 0.1% as analysts expected.

The main focus this week will be on minutes from the Bank of England’s latest Monetary Policy committee meeting, together with voting on interest rates.

China Crisis

According to official figures, China has lowered its GDP growth figure for last year by 0.1 percentage points to 7.3%. Concerns are mounting across the financial ecosystem over the snails pace expansion in the world’s second biggest economy. The National Bureau of Statistics posted on its website that it lowered the figure after a ‘preliminary confirmation.’

Global Comment

Today the US markets shuts for Labour day holiday, with volumes traded expected to be very light. At the end of last week, the US Labour Department released data showing the US economy added 173,000 jobs last month, slowing from an upwardly revised gain of 245,000 the previous month. This represents the lowest increase in employment in just under half a year and below forecast of 220,000. EUR/USD is trading now in the region of 1.1157.

The Kiwi Dollar slipped against the US.Dollar in todays earlier trade, coming close to a recent six year low. NZD/USD hit 0.6260 in the late Asian trade, the pairs lowest since the middle of August. GBP/NZD is trading in the region of 2.4235

The Aussie Dollar jumped off a six year trough against the USD this morning. AUD/USD hit 0.6949 following news job advertisements in Australia increased by 1.0% in August after a 0.5% drop in July. GBP/AUD is trading around 2.1939

Have a great day!