Home > Resource Hub > Daily Market News > Negative ne

Negative ne

Negative ne

The Pound stayed roughly range bound yesterday as news that Standard & Poor were keeping their negative watch on the UK’s AAA credit rating, was later countermanded by a stock market recovery, which was led by rumours of a takeover of BP. Standard and Poor are the only rating agency out of the three who have the UK on negative watch and even then they say that they will remove it if the UK government go through with their proposed spending plans. As the government do seem intent on reducing spending the chances of a downgrade now seem very slim  and the chances are that S&P will join Moody’s and Fitch in keeping Sterling at the AAA rating.

The rating agencies release may have caused Sterling some mild distress, but that was soon relieved as rumours of a takeover of BP led the stock market higher. The Chairman of BP has been on a world tour, desperately trying to drum up some capital injection to help pay for the oil spill in the Gulf Coast, but it seems that it may not be enough and it looks like BP (who are already a conglomeration of British Petroleum and a number of American oil firms) may be the target of a takeover which would be huge news for the 4th biggest company in the world. The news helped give the Pound some support, but it is still left in roughly the same range in which it started the week.

The Euro has continued to slip back against the Dollar as the tension mounts ahead of the release of the ECB banking stress test on the 23rd of this month. When it was announced that the stress test results would be made public, the news was welcomed, but as rumours start to spread that the results may not be all that positive, tension has started to ratchet up. The Euro has now dipped down below 1.2550, and until the stress test is released the tension is likely to cap any further Euro gains.

We get the latest inflation data for the UK today which is likely to show inflation coming down, but slower than many would wish. We’ve already had overnight data showing house prices growing slower than expected, although retail sales have been a healthy 1.2% higher than last year, no doubt boosted by a bit of sunshine and the England’s brief appearance in the World Cup. The UK inflation data may give the Pound a little support, but with inflation expected to remain stubbornly high, it is unlikely to offer anything more than that. It will be the BoE Minutes released in a couple of weeks which will show the MPC’s attitude to inflation which may shape the Pounds near future.

Are you thinking whgat does this mean for me? Well Currency UK serve handle both business and private individuals foreign exchnage requirments. Whilst the above may seem a bit technical for those that have not had any foreign exchange dealings previously, we will be happy to talk you through evreything on a one to one basis.

Currency UK will save you money because we provide better exchange rates than your bank AND we offer cheaper transfers than your bank (for trades of GBP 5,000.00 and above transfers are free). Contact us now to see how we can help you.

Share this case study
Set yourself up in minutes, make payments the same day: it’s free, easy and without obligation.