Forex Trading News – GBP at a 6 week high against the EUR due to a boost from the BOE

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EuroEUR fell today, with risks to the downside on mounting uncertainty over whether euro zone officials would provide timely financial aid to Greece and Portugal. EUR/USD is being dominated by concerns about Greece and Portugal and the contagion concerns that triggered a sell-off last week could see the common currency fall further. It currently traded down 0.3% on the day versus the USD at $1.4352, in sight of a 3 week low of $1.4253 hit on Monday


GBP hit a 6-week high against the EUR after the Bank of England raised its medium-term inflation forecasts in its Quarterly Inflation Report, with markets now expecting a UK rate hike by year-end. Hawkish inflation report from the Bank of England drove investors to unwind long positions in the euro and buy the British pound. EUR was down more than 1% at 87.05 pence falling to its lowest since March 24. The Quarterly Inflation Report led money markets to bring forward expectations of a rate rise in the UK to December from January.


CHF moved higher versus the EUR today as speculation about another Greek aid package pushed investors towards the safe haven currency. Analysts say that CHF might see a short-term correction against the EUR but uncertainty surrounding Greece could then push it back up above the 1.2500 level. EUR/CHF opened the session trading at 1.2668 and fell as low as 1.2629.


CHF hit session lows versus the USD after the Swiss consumer price index rose 0.3% from a year ago, well below forecasts for a 0.7% rise pushing back markets’ expectations for an interest rate hike. The lower headline CPI and the lack of news on the European fiscal situation pushed out rate hike expectation by the SNB into the end of 2011 resulting in a softer CHF for a change.


AUD rose to a 1 week high versus the USD, underpinned by strength in stocks and commodity prices, but slightly disappointing Chinese data knocked the currency off the session peak. AUD/USD opened the session trading at $0.8796 and hit a session high at $0.8825.



(07:00 GMT)

1.4400 0.8801 1.6357 0.8796 1.2668
DAY’S HIGH 1.4422 0.8809 1.6516 0.8816 1.2677
DAY’S LOW 1.4352 0.8691 1.6349 0.8782 1.2629

(16:00 GMT)

1.4344 0.8706 1.6473 0.8806 1.2636