best rates for pounds, euros and dollars

IMS FX DAILY MORNING REPORT - 6th January 2011

Today's Interbank rates -

POUNDS TO US DOLLARS 1.5480
POUNDS TO EUROS 1.1804
POUNDS TO AUSTRALIAN DOLLARS 1.5526

EUROS TO US DOLLARS 1.3114
EUROS TO POUNDS 0.8471
EUROS TO AUSTRALIAN DOLLARS 1.3149

POUND HEADLINES:

• Today's focus will be on the UK services PMI for
  December. Markets will hope for a positive surprise similar to that seen in
  the manufacturing release earlier this week.
• UK services PMI is a dangerous number for sterling today.
  With data elsewhere on the positive side, a weak UK number could make
  sterling the funding currency of choice, given the hit still to come this
  year from fiscal austerity measures.
• Despite a disappointing reading of activity in the
  UK's construction sector, sterling gained a cent against a weaker euro
  yesterday and has touched a three-week high this morning.

EURO HEADLINES:

• Germany's factory orders for November are published today
  and are likely to show material signs of softening in the wake of more
  recent declines in key Asian PMI's.
• Also today it is expected the Eurozone business
  confidence indicator to rise in December based on stronger domestic surveys,
  while the final reading of consumer confidence is also due.
• While the Euro suffered initially on strong US data, the
  Euro tends to benefit in more benign risk conditions, and already is at
  quite extended levels against the commodity currencies which would normally
  benefit from risk positive news. While sovereign debt concerns remain,
  evidence of strong growth globally will tend to moderate these concerns too,
  and may limit negative sentiment towards the Euro.

US DOLLAR HEADLINES:

• In the US, this weeks jobless claims will continue to
  drip-feed labour market news in the wake of yesterdays strong ADP payrolls
  survey.
• Claims fell to their lowest level in 2.5 years last week.
  This will be the final teaser before tomorrows payrolls release.
• The USD benefited from the rise in ADP employment, but
  sustained USD gains will require some genuine belief that US rates are set
  to rise this year, and that will require several months of payroll gains of
  more than 300k.

If you need to buy, sell or make an international payment today then please
call me for a free quote.

Kris Charalambides

FX Broker

kris@imsfx.co.uk

www.imsfx.co.uk

Tel: 0207 183 2790