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The Pound made gains against the US Dollar, rising close to its highest-level for eight-months. The currency’s strength came after Bank of England Governor Mark Carney told a UK newspaper that he sees no reason for the use of further stimulus measures. Sterling rose against all of its peers as UK consumer confidence rose to its highest-level in six-years. Over the past six-months the Pound was the best performing currency after rising by 6.5%.
The ‘Greenback’ softened against the Pound and Euro as concerns over a possible shutdown of US Federal government departments continued to weigh upon investor sentiment. Republican leaders in the House of Representatives refused to give in to President Barrack Obama’s demands for funding to keep the government running beyond the end of September. Speculation as to when the Federal Reserve will begin tapering its monetary easing programme increased after a Federal Reserve policy maker said that the improving jobs picture in the country means that a cut should take place.
The Euro is holding steady against the US Dollar as concerns over the US debt ceiling and Federal Reserve monetary easing programme weigh upon market sentiment. The markets remain jittery after US data reports raised concern for the recovery of the world’s largest economy. Adding to the pressure upon the single currency were comments made by a European Central Bank board member who said that the Central Bank could cut interest rates even further if needed.
The ‘Aussie’ is on course to make its first weekly decline in September as demand for riskier assets waned as fears over a US government shutdown spooked the markets. The currency looks set to fall further ahead of next week’s Reserve Bank of Australia policy meeting as speculation rises that the Bank may choose to make another interest rate cut.
New Zealand Dollar
The ‘Kiwi’ followed its Australian relation downwards as news from the United States dominates market sentiment. All eyes will be on next week’s developments in the USA’s corridors of power. If politicians cannot agree to lift the nation’s debt ceiling next month then Federal government will shut down.
The Canadian Dollar fell to a weekly low against the US Dollar and softened against Sterling after the nation’s biggest export of crude oil traded at its lowest-level since July. The ‘Loonie’ was also affected by the weakening demand for riskier assets in the wake of the looming political crisis in the USA.
South African Rand
The Rand is softer against the US Dollar as a strike began at Anglo American owned Platinum mines. Negotiations in the United States over the nation’s budget and the increasing of the federal debt ceiling will also be closely watched by the market and the impasse is likely to weaken the Rand further as investors favour safer assets.