As the volcanic ash refuses to move bringing crisis to the European airline industry, a further cloud is cast over global economies by the Goldman Sachs investigation. Under all of this, fears surrounding the Greek rescue plan continue to simmer.

Pound Sterling – UK Markets

Sterling is starting the week in a fragile state after the media hype of the weekend focused on the surge of support for the Liberal Democrats and in particular their leader Nick Clegg. As various opinion polls veraciously fuel speculation of a hung parliament, the pound sits weakly, falling the most in almost two weeks against the dollar. It has also slumped against the Yen, attributed to the Goldman Sachs investigation. A large release of UK data is due this week, kicking off with a Right Move report on April’s house prices today. It is expected to indicate a raise, although this should be treated cautiously. The fact that British pilots have begun to call for a banking style rescue of the UK airline industry, in the ongoing wake of the volcanic ash-cloud, does not bode well for Sterling confidence. £130 million a day is estimated to being lost by airlines due to flight restrictions.

US Dollar – US Markets

The US Dollar starts the week sitting high against the Pound and the Euro. March’s leading index data is due today in the US; a rise would follow suit on the last eleven months being the twelfth in a row. This follows the release of housing data on Friday last week, which gave signs of recovery with a more than expected increase in the construction rate of new houses.

Euro – European Markets

The Euro continues to fall against the dollar after Greece’s bailout package seems ever more likely to be activated. The volcanic ash problem has interfered with plans for talks between the European Commission, the IMF and European Central bank today, meaning that they have been postponed until Wednesday.

Other Currencies – Highlights

The US Securities and Exchange Commission’s fraud charges against Goldman Sachs Group Inc. are having repercussions in the confidence of markets the world over. This is tied to allegations that Goldman Sachs collateralized debt obligations in early 2007. Asian markets have started the week with strong declines. Gordon Brown has called for a UK investigation into Goldman Sachs, as well as German regulators and the EU; it would look like this situation is very much still on its way to eruption point.