The pound is holding ground against its major currency partners this morning, ahead of labour market figures due in the UK today. The Australian dollar has reached a near one-year high against the US dollar on the back of Chinese demand and the euro has strengthened following strong German figures.

Pound Sterling – UK Markets

Sterling exchange rates are mixed this morning, rising against its Asian currency partners while falling against its European partners. The pound is currently slightly higher against the US dollar in the region of 1.67 and trading at 1.11 against the euro.

The UK trade balance has dipped further into the red, sinking to GBP3.5 billion in September. UK interest rates are expected to remain low for most of next year as recession has kept inflation rates low for 2009. Today the UK is dominated by labour market figures with average hourly earnings and the ILO unemployment rate potentially causing some volatility for the pound.

US Dollar – US Markets

US dollar exchange rates are also mixed, down slightly against the pound and euro yet higher against the yen and Asian currency partners. The greenback is currently trading at 0.66 against the euro and 0.59 against the pound. 

The Dow Jones remains buoyant this week, heading for its largest monthly gain since July on the back of economic data. The US dollar has dipped in the wake of the G20 statement which pledges economic support for the major economies. The US dollar has extended gains against the pound after credit agency Fitch stated the UK faced greater risks than the US. Today is light for US data with continuing jobless claims figures due tomorrow.

Euro – European Markets

Euro currency rates are on the rise this morning, gaining against the US dollar and pound as well as its major Asian currency partners. The euro is currently valued around 1.50 against the euro and 0.89 against the pound.
 
Positive figures from Germany yesterday helped the euro to regain ground against the pound. Industrial output rose in Germany in the last month, gaining 2.7% ahead of market expectations while the trade balance also narrowed. However, the ZEW economic sentiment survey for September dipped to the region of 51. Today is light for eurozone data and European investors will likely be looking to UK markets for direction.

Other Currencies - Highlights

Currency rates for the Australian dollar reached near a one-year high against the greenback as retail sales and output rose in China, prompting speculation that the Aussie would benefit from the increase in Chinese demand. In contrast to the currency, Aussie consumer confidence fell in November by 2.5%. The Australian unemployment rate is due tomorrow.