British pound – The pound rose to its threshold of resistance as investors lifted it higher as the risk rally remained intact. The pound also recently lost further support for any nearby increase in interest rates with anecdotal evidence indicative of a hangdog consumer. In data released Wednesday lending activity remained soggy with mortgage approvals remaining at a flat-line reading while consumer lending of just £200 million indicates little appetite for fresh debt at a time when prices are rising. An index of services also unexpectedly dropped 1.2% during April after rising by 0.8% in the previous month. The pound reached $1.6048 on Wednesday having tried to break through an area of seemingly tough resistance on three occasions in the last four days.
Aussie dollar – The Pacific unit was again unleashed on hopes that European tensions would be successfully resolved starting with Wednesday’s vote. Even a 2% decline in job advertisements for skilled workers failed to restrain the Aussie. By early morning in New York the unit had risen to $1.0621 U.S. cents adding about a penny on the day and edging closer to its highest in a week. The local dollar also brushed off a reading from Beijing showing further downturn in its leading index using April data.
Japanese yen – The recent bout of risk appetite may have taken its toll on the dollar but it’s also soured demand for the Japanese yen, at least in terms of the dollar. On Wednesday the Japanese yen eased to its lowest in four weeks with the dollar touching ¥81.26. The yen surged following news that Greek lawmakers accepted Papandreou’s austerity bill driving the unit to ¥80.58.
Andrew Wilkinson is a Senior Market Analyst at Interactive Brokers LLC
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