FX Weekly: 7th February 2011
Inflation is quickly becoming the focus. Both developed and developing nations are facing increasing inflationary pressures but only a few central banks can afford to tighten policy at this stage in the recovery
US Dollar was lower across the board (except against CHF) as continuing equity market strength, higher commodity prices, declining political risk and risk-tolerant market sentiment weighed on the Greenback
Above target inflation and resulting speculation for a pre-emptive move by the ECB is talked down by ECB officials
Sterling benefitted from a swathe of positive macro data. The likelihood for a significant revision to Q4 GDP is very high following last week’s PMI figures in particular
Egyptian political crisis not a significant factor for vast majority of asset classes although sudden and rapid escalation remains plausible
US Dollar was lower across the board (except against CHF) as continuing equity market strength, higher commodity prices, declining political risk and risk-tolerant market sentiment weighed on the Greenback
Above target inflation and resulting speculation for a pre-emptive move by the ECB is talked down by ECB officials
Sterling benefitted from a swathe of positive macro data. The likelihood for a significant revision to Q4 GDP is very high following last week’s PMI figures in particular
Egyptian political crisis not a significant factor for vast majority of asset classes although sudden and rapid escalation remains plausible
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