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Sterling falls against strengthened euro

Published:  11 October, 2011

France and Germany's announcement to recapitalise European banks caused sterling to fall dramatically yesterday against the much stronger euro.

France and Germany's announcement to recapitalise European banks caused sterling to fall dramatically yesterday against the much stronger euro.

Currency rates - October 11

EURO/GBP - 1.1454
US$/GBP
- 1.5635

CHF/GBP - 1.4144

CAN$/GBP - 1.6126
AUS$/GBP
- 1.5841
ZAR/GBP
- 12.3352
JPY/GBP
- 119.98
HKD/GBP
- 12.1740

NZD/GBP - 2.0002
SEK/GBP
- 10.4345

US$/EURO - 1.3626


However, sterling made gains against the US dollar as a fresh wave of risk appetite saw investors reverse 'safe haven' positions in the US dollar. The lack of UK data meant that sterling's moves were largely driven by swings in risk appetite. Sterling seems to have recovered from the £75bn Quantitative Easing announcement, as analysts realise that the pre-emptive move by the Bank of England is quite positive.

In the euro zone, the news of the pledge by the French and German leaders Nicolas Sarkozy and Angela Merkel was met with relief by many, seeing the euro strengthen by 1.5% against sterling and testing recent sterling lows. Whilst many hope the single currency to cling on, sentiment remains very fragile as European leaders have disappointed many times before. The most cynical of analysts will point to the fact that no concrete detail has been outlined.

In the USA, stock markets rallied on optimism over a potential deal for Europe and the US dollar fell as investors moved out of 'safe haven' investments into other 'riskier' currencies.

Elsewhere, Japan's ruling party policy chief said Japanese yen selling and intervention was needed to counter an extreme appreciation of the yen. The Japanese yen has been considered a 'safe haven' currency and has seen huge appreciation over the last few months. Call in now for an exchange rate.


Smart Currency Exchange is a currency partner to Harpers Wine and Spirit. Harpers Wine and Spirit has teamed up with Smart to provide readers with a free bespoke currency service. www.SmartWineSpirits.com


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