Market News Archive

01 January 2009

December market commentary

As expected the Bank of England (BoE) slashed interest rates again in December following a 1.5% cut in November. The Monetary Policy Committee (MPC) agreed on a further 1% cut reducing the UK base rate to 2%. Sterling suffered some big losses following the cut recording new lows against both Read more

01 December 2008

November market commentary

In our commentary last month we indicated that the Bank of England may cut the base interest rate more aggressively than the 50bps forecast and indeed they did. However what we did not see coming was the announcement of a 150bps cut, and I hasten to add nor did the majority of market analysts. This pushed UK interest rates to 3%, their lowest level since 1955 Read more

02 November 2008

October market commentary

It has been another roller-coaster month for sterling as GDP data released showed that the UK economy contracted by 0.5% in Q3 compared with the previous quarter. This is the first contraction since Q2 1992 and the biggest quarterly fall since Q4 1990. Read more

01 October 2008

September market commentary

It is fair to say recent market events have completely overshadowed economic data releases. It all started with the failure of Lehman Brothers and the Fed having to prop up insurance giant AIG. Then HBOS, the UK's largest mortgage lender was forced to be bought by Lloyds TSB following aggressive short selling of HBOS shares. Subsequently, Read more

31 August 2008

August market commentary

As expected, the Bank of England left interest rates on hold this week and we will have to wait two weeks to find out how they voted and whether the committee remained split on their decision. Last month seven of the nine members voted to keep rates on hold with one member voting for a cut and one for a hike. Mervyn King, Governor of the Bank of England has also spoken about the Read more

31 July 2008

Pure FX market commentary

The Bank of England has a tough task to steer the UK economy through these choppy waters. This month the Monetary Policy Committee (MPC) felt that despite high inflation, interest rates should remain at 5%. The minutes of the meeting show this was not a straight forward decision... Read more

30 June 2008

Pure FX - Foreign Exchange Market Commentary - June 2008

The Bank of England (BoE) is in a difficult position with inflation set to accelerate towards 4% in the coming months, and economic growth slowing. Rising inflation would usually lead to the BoE increasing interest rates whilst they would normally be cut to stimulate economic growth. Read more

30 May 2008

Pure FX - Foreign Exchange Market Commentary - May 2008

I think it would be fair to say that one of the main economic factors recently has been the ever increasing price of oil. Why should this affect currency values? Well at the moment in the UK our economy is slowing but inflation remains above the 2% target, which is mainly down to high food and energy prices. Read more

30 April 2008

Pure FX - Foreign Exchange Market Overview - April 2008

Sterling has continued to struggle this month and given recent economic data it is difficult to see which sector will provide the UK currency with the support that it needs. Interest rates were cut by 25 basis points earlier in the month with MPC voting split three ways, although so far the banks have been unwilling to pass this reduction onto consumers. Read more

31 March 2008

Pure FX - Foreign Exchange Market Overview - March 2008

It has been an interesting month and sterling remains under pressure. The Bank of England voted to keep interest rates on hold at 5.25%. This was forecast, however the minutes indicate a cut in interest rates is just around the corner. Another major factor to sterling weakness was speculation that HBOS was in a precarious financial position. Read more

29 February 2008

Pure FX - Foreign Exchange Market Overview - February 2008

Underlying confidence has remained fragile this month with persistent unease over the financial sector. The nine members of the Bank of England'™s (BoE) Monetary Policy Committee (MPC) voted unanimously for a rate cut with one member, David Blanchflower voting for a 50 basis point reduction. Read more

31 January 2008

Pure FX - Foreign Exchange Market Overview - January 2008

It has been an interesting month for economic news and since Christmas sterling has been under pressure, caused mainly by the credit crunch in the US, continuing issues with Northern Rock and whether the wider UK economy will begin to suffer as a consequence. One of the first main economic indicators for the New Year was news that the Bank of England decided to keep interest rates on hold. Read more