Euro registers losses despite an ostensibly good news day for risk assets
31/Jul/2012 • Currency Updates•
A highly positive session for global equity markets has seen the US dollar remain out of favour amongst international investors, who have continued to dip their toes into the sea of riskier assets. Looking forward, with Thursday’s Bank of England and ECB policy announcements likely to bring positive developments, the Greenback could remain under pressure in the near-term.
Investors continued to shun the euro in spite of reduced borrowing costs for both Italy and Spain, taking GBP/EUR above the 1.28 mark once again. Concerns are still growing with the single currency as after it registered losses yesterday on an ostensibly ‘good news’ day, what will happen if the indicators turn poor once again?
Elsewhere, sterling remained fervently out of favour in the currency markets yesterday, as participants remain wary of the UK currency following last Wednesday’s desperate growth figures. Sterling lost ground against the dollar on Monday, in line with a broadly weaker euro, as poor UK data coupled with investor unease over whether the European Central Bank will meet market expectations to support the eurozone weighed. With Thursday’s BoE decision offering the possibility of further QE for the UK, the future looks far from bright for the pound.