Thread: Major currencies – key points this week

Hi everyone, please see the latest currency updates below – thanks.

AUD: Nervousness about global growth hurt all three of the commodity-oriented dollars and the Aussie was fortunate to take the least damaging blows. It even managed to outperform the benighted euro, though not through any intrinsic economic qualities. A 1.1% monthly increase for new home sales did little to offset the -16.2% fall in the preceding three months. More worrying was a further decline in the AiG manufacturing index, which showed a worsening slowdown in activity.

USD: The US dollar missed out on another win-win week but it, alongside the Swiss franc, was not far behind sterling. The main handicap for the dollar was the expectation of a positive outcome when the German parliament voted on the country's support for the second bailout of Greece. After that vote went through as expected investors were left with nothing to look forward to and they drifted back towards the US currency.

NZD: As well as the negative sentiment surrounding the world economy, New Zealand also had to cope with a downgrade of its credit rating from AA+ to AA by two of the big three agencies. The unwelcome news added to the downward pressure on the Kiwi. It is now more than -8% of its early-August high against sterling and a further retreat is easy enough to imagine if current technical obstacles can be overcome.

CAD: Among the trio of "commodity" dollars it was the Loonie that fared least well, although it was not far behind the NZ dollar and the Japanese yen. There was no compelling reason for its underperformance other than a vague sense that the Bank of Canada might be inclined to lower its benchmark interest rate when the policy committee meets in three weeks' time. Nevertheless, it lost -1.7% to the pound and a significant -5.1% to the US dollar.

EUR: The good news for the euro was the German Bundestag's vote to support the second Greek bailout. The bad news came two days later with an announcement that Greece would miss its target of reducing its budget deficit to 6.5% of GDP next year. In theory that means Greece will not be allowed to receive any more bailout money. In practise it just means that EU leaders will have to come up with a plausible reason why that will not happen. Either way, it is not a positive development for the euro.

GBP: Sterling had a good week. Mixed news on UK house prices was offset by the highest monthly number of mortgage approvals since January last year. Gfk's index of consumer confidence showed a small but welcome and unexpected improvement to a still-negative -30 in September. Despite the media clamour, analysts do not expect the Bank of England to reactivate its asset purchase "money printing" at this week's policy meeting.

Hi all - the latest currency update is below - thanks.

AUD: The commodity- and energy-related currencies were at the upper end of the scale for the same reason the US dollar was close to the bottom. The prospect of a resolution to the European debt crisis created a more upbeat market view, dispelling - at least for the moment - the prospect of a Euroland blow-up and a global recession. If recovery looks more assured, China will want more of Australia's ore and coal exports.

GBP: The pound kept company with the safe-haven dollar, yen and franc not because of its AAA credit rating but because investors suspected the Bank of England might embark on another round of quantitative easing. Sure enough, on Thursday the Bank did exactly that, announcing another £75bn of asset sales. The news was temporarily bad for the pound but seemed to have done no long-lasting damage.

NZD: Rugby-related beer sales are contributing to the NZ economy but the world cup has also displaced some of the usual economic activity. The effect of the Canterbury earthquake has at last become positive though. The rebuilding effort has driven business optimism in the area to the highest level in the whole country. On a broader front, business sentiment was muted in the three months to September although firms seemed to be more worried about the general outlook than they were about their own particular business.

USD: Upbeat sentiment among investors carried through the weekend, spoiling their appetite for the safe-haven US dollar and Japanese yen, which were the week's worst performers. A stronger than expected US employment report was also, perversely, negative for the Greenback. The argument there was that a stronger US economy points to a stronger world economy. That meant less reason to stock up with low-risk assets such as the dollar.

EUR: It was an above-average week for agreements to solve the southern European debt crisis. Two of them emerged; one between EU finance ministers to continue lending money to Greece and one between President Sarkozy and Chancellor Merkel to recapitalise European banks. No details were revealed, of course, but this time investors think they might really be serious about solving the problem. The European Central Bank helped things along with a promise to lend unlimited amounts of money to Euroland commercial banks.

CAD: Improved investor optimism was as helpful to the Loonie as it was to the antipodean dollars. A steep -10.4% monthly fall in Canadian building permits was only a temporary hindrance. Otherwise the economic data were robust. The Ivey purchasing managers' index bucked the global downward trend with a six-point improvement to 63.4 in September. There was good news on the employment front too. A net 60.9k jobs were created in September, three time as many as expected.

Hi everyone – please find the latest currency updates below – thanks.

AUD: There was a similar feeling of déjà-vu among the "commodity" dollars. Fewer worries meant a greater appetite for the currencies of commodity exporters, especially for those offering an above-average rate of interest. Australia further improved the AUD's position with stronger than expected employment data, including a fall in the rate of unemployment to 5.2%. The overall effect put the Aussie in top place for the week.

GBP: Sterling spent another week in the company of those more famously safe-haven currencies, the US dollar and the yen. The pound dodged the potentially damaging effects of a 15-year high for unemployment but remained in the shadow of the euro. Although grouped at the bottom of the league with the USD and JPY, sterling outperformed both, pulled ahead in the euro's slipstream.

EUR: Europhoria supported the currency for another week. Investors' optimism paid off when it was confirmed that EU leaders will announce a full and final solution to the Euroland debt problem this coming weekend. Although only a broad-brush plan is expected, investors are confident that it will lead to concrete results. As long as that confidence survives the euro will remain buoyant.

USD: It was exactly the same story last week as it had been during the previous seven days. The European Union was preparing a real, concrete, workable plan to sort out its debt crisis, removing a major cause of concern for the global economy. That worry having been removed, investors did not feel the need for safety offered by the US dollar and the yen. For a second week the two safe-haven currencies wore the worst performers

NZD: The Kiwi was close to the top of the table, also driven mainly by renewed optimism about Euroland, but could not keep pace with the Aussie. Not only were there no convenient and helpfully strong statistics from the New Zealand economy, New Zealand's 2.5% benchmark interest rate looks anaemic alongside Australia's 4.75% equivalent. The NZ dollar did not do badly; it just fared less well.

CAD: Of the Commonwealth trio the Loonie came third. Perhaps it was held back by its 1% benchmark interest rate - the lowest of the bunch. Maybe it was the shortage of positive economic data. Either way, the Canadian dollar could not attract as much support as its South Pacific cousins. Canadian economic data were decent enough but not sufficiently so to generate upward traction.

The Australian dollar has strengthened after it was reported that France and Germany were ready to boost the eurozone's rescue fund in a bid to address the public debt crisis.

The markets are very fragile currently, therefore any news is having an impact on currencies – in this case, the suggestion of a solution to the debt crisis sparked interest in the Australian dollar (making it strengthen).