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Major currencies were little moved on Monday ahead of the Christmas festivities.
The pound began the festive week on the back foot after UK GDP growth was revised down to zero in the three months to October.
A sleepy day for currency markets was marked by thin trading volumes and a general sense of respite. A brief fightback for the pound and the euro against the US dollar faded in the afternoon, as whatever transactions took place shaded towards the risk averse.
Among those revised UK GDP figures, one brighter spot came from business investment, which increased by 1.9% quarter-on-quarter — well above the expected 1.2% increase.
Subdued US durable goods orders failed to make any serious impression on the US dollar. New orders for durable goods fell by over 1% in November having increased by 0.8% in October. Once that failed to change matters, the handful of other final reads for November were always unlikely to distract markets from swapping work for gift-wrapping with a limited amount of fuss.
In other news, the British chamber of commerce made 13 recommendations on how to fix the UK-EU trade pact. Among those measures was a call to reinstate “comprehensive” youth mobility, more flexibility for business travellers and a link to the UK and EU carbon trading schemes.
On behalf of everyone at Smart Currency, we wish all our readers a joyful festive period. Our offices will be open as usual on Friday (27 December), so please do get in touch with us should you have any currency requirements.
Make sure any upcoming transactions are protected against the risks of sudden market movements. Secure a fixed exchange rate now with a forward contract; call your account manager on 020 3918 7255 to get started.
GBP: Investment provides hope
Based on recent figures, the British economy is crying out for substantial investment. It was good timing then that Monday’s GDP revision was tempered by a 5.8% annual increase in business investment. Sustaining that sizeable economic input could be a boon for the pound in the longer term.
GBP/USD: the past year
EUR: A quiet end and troubles ahead
The euro held its ground against the pound while falling back slightly against the US dollar yesterday. The euro looks set to end the year dangerously close to its lowest mark in two years against its key rivals. It will hope 2025 brings more good news, although the German election is a notable barrier to those ambitions.
GBP/EUR: the past year
USD: Dollar finishes near two-year high
A quiet and risk-off end to 2024 means the US dollar approaches Christmas close to its strongest in two years. Despite the pretty poor outcome of last month’s durable goods report, markets were satisfied the US dollar had cleared its last major risk of the year, particularly after avoiding a looming government shutdown over the weekend.
EUR/USD: the past year
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