24 February 2010

Online Accounts with Foreign Exchange Brokers

Welcome to the Foreign Exchange market, membership - global, daily turnover - well over $3 trillion.

The foreign exchange market is the largest liquid market in the world and is now highly populated with private investors alongside the corporate foreign exchange investors. While companies traditionally buy and sell currency pairs as part of their profit-making arms, private investors can trade directly for returns.

Most foreign exchange brokers now offer an online service alongside the more traditional telephone execution method - this allows for 24 hour trading and as many daily trades as possible.

18 February 2010

Pound rises on MPC minutes

The pound rose against the euro after the Monetary Policy Committee of the Bank of England released its latest meeting minutes.

It was shown that all nine members of the MPC had voted against increasing quantitative easing. This did surprise some economists but it was suggested that the committee's unanimity was only just reached.

Apparently they were worried that if they increased QE, the public would get a negative impression on how they are dealing with inflation.

Inflation was 3.5% in January, much too high when you consider the government target is 2%. Yet in the medium term it is forecast to be 'below target' - something which would actually warrant more asset-buying to drive it nearer to target.

17 February 2010

Euro gains after Weeks of Sell

Has anti-euro sentiment gone too far in recent weeks? Some currency exchange analysts seem to think so; and as if by magic the euro climbed on Tuesday - is risk appetite back among investors?

Greece's fiscal problems have really given the euro what some have described as a fair battering over the last few weeks. But are currency traders cautiously heading back to the eurozone single currency?

Meanwhile there is a lot of key data being announced this week, much of which will surely have an affect on the pound.

Yesterday, CPI figures were released showing that inflation rocketed to 3.5%, well above the 2% target. This didn't seem to bother markets much, though BoE minutes and retail sales figures to be announced might prove important for the pound. Will it retreat or wobble under pressure?

11 February 2010

Sterling in 2010

Where is the pound heading? The Bank of England believes its depreciation - helped by the asset-buying scheme which was frozen last week - will prove positive in the time to come. Currently, it sits between the euro's weakness (thanks to the fiscal problems in Greece) and the strength of the US dollar, which is being used as a safety net.

Since EU members have started to talk of providing boosts for Greece to help it out of its deficit problems, the euro has bounced back a little. Yet in the week to 2nd February, speculators bet against the euro in record numbers. Short positions reached around 400,000 according to some reports.

So, are the UK's economic problems as bad as those of Greece? The Bank of England Governor Mervyn King says not, saying that the two countries cannot be compared. Judging by the amount of investor nerves on Greece, one certainly hopes so - the UK needs all the help it can get. A quarter of negative growth is expected for Britain this year.

09 February 2010

January Retail very Low

January retail sales on Britain's high streets were at their worst in 15 years - not a great start! In December, despite freezing weather shoppers had been out shopping in droves - why did they stop in January?

Well, for one VAT returned to 17.5% after having been at 15% for a long while. Another factor is, believe it or not, the continuing cold weather and snow - it makes people want to stay at home.

It's not all bad news though - online shopping is as healthy as ever and continues to gain strength. Food sales are also not doing too badly.

Meanwhile currency speculators are still nervous around the sterling - despite a cautious edge up this morning against the US dollar - at 0.1% it wasn't a huge rise but nevertheless better than Monday's 8 1/2 month lows.

05 February 2010

Stocks Fall in EU and USA

On Thursday (yesterday), stock markets in both the US and Europe experienced sharp falls. Why?

Well, for Wall Street the downer came thanks to unemployment claims figures which were released. They were worse than expected - making investors jumpy about what is going on with the economic recovery. Will it ever gain stability?

In Europe, there were renewed fears about Portugal. Is it going to be the next Greece? Government bonds there fell in demand - and as investors are already nervous about the situation and whether EU stability will be weighed down by Portugal, shares took a dive.

One or two economists reacted to Wall Street's drop by saying that investors had been "spoiled" by gains since March last year and that the market still needs to finish correcting.

04 February 2010

Greece Deficit over Four Times too High

The nerves over Greece's economic problems have really hit the currency exchange market - and there is risk that this jumpiness will spread to other European Union countries who are in trouble.

The euro has really suffered the knock - but for how much longer?

Did you know that Greece has a budget deficit over four times higher (at 12.7%) than is allowed by the EU rules? It now plans to reduce this to less than 3% by 2010 - an ambitious intention!

So ambitious, most of Brussels is in doubt that they will achieve it - but the European Commmision has vowed to support Greece (and will keep a heavy eye on them too).

After all, surely it is better that they reduce the problem than ask for a big bail out from other EU countries?

03 February 2010

Consumers are Happier!

Good news! Consumer confidence was up in January - and by nearly three times more than in January 2008.

January 2008 was a time of deep doom and gloom about the economy, yet no-one expected that the recession would continue as long as it did...

So, are more people out and about shopping and being happy consumers? Well, not quite - but the outlook seems to have improved. Now that the country has officially exited the downturn (though at 0.1% it was hardly earth-shattering) it looks as though overall there is a more positive outlook.

Meanwhile, the currency exchange market is eagerly waiting for the BoE's latest decision on the asset-buying programme ---- will it continue? Or is it time to slow it down - one might think consumers would probably say we're ready to stand alone!

01 February 2010

The Pound Tumbles

Speculators are eagerly waiting for the next Bank of England decision - which will happen on Thursday.

On the currency exchange market this morning, the pound took a dive against the US dollar and the Euro. Speculators are worried that the Bank will decide to extend its massive QE (quantitative easing) programme - a fact which would cause large amounts of pound-selling.

In addition, there was a flurry of concern about Britain's political climate: surveys published over the weekend showed that right now, neither of the two main parties (Labour and the Tories) would get a majority win at the general election.

Seems as though neither Gordon nor David can be sure that they will be governing the country come summertime.