Kiwi dollar pressed higher against the pound on Friday, and has reached last weeks record highs already this morning

The pound continued to lose ground on Friday, losing a further two cents to close at 2.3844.

• On Friday, a report showing that US employers shed fewer jobs in August than economists forecast, encouraged demand for higher-yielding assets, supporting demand for the kiwi.
  
• The kiwi was also supported by Asian stocks which continued to rally, building on Thursday’s biggest gains in six months.
  
• So far this morning, the kiwi has continued to trade higher, once again taking direction from Asian equities which, led by Chinese stocks, were broadly higher.
  
• Data today also showed that New Zealand wholesales fell 0.9% in the second quarter, the fourth consecutive quarterly fall and, which has prevented the pound from sliding too far, currently trading just 0.1% lower for the day.
  
• Additionally, the treasury said that New Zealand has emerged from recession, but warned that a high currency threatened the fragile, export led, economic recovery.

Aussie continues to strenghten against the pound as strong equities heighten risk sentiment

The Australian dollar posted further gains against the pound on Friday as risk aversion eased following US payroll data.

• Having traded relatively steadily on Friday morning, the aussie was able to post strong gains in the afternoon as investors were encouraged into the higher yielding currency following the release of the US non-farm payrolls.
  
• Although the data released was ambiguous due to the rise in overall unemployment, investors chose to focus on the brighter side of the data, which eased risk aversion and increased demand for the Australian currency.
  
• The aussie has continued to trade strongly this morning as firm Asian stocks supported bids for riskier currencies.
  
• An upbeat job ads report released this morning added to the overall positive note in the Australian markets with sterling currently trading 0.25% down for the day.
  
• Analysts have warned that as markets are shut in the US today, thin trade could exaggerate any moves in the Aussie later today.

Euro made strong gains vs the dollar on Friday; continues to do so today with the US markets on holiday

The euro made strong gains against the dollar on Friday as risk sentiment was supported by US payrolls data, with the pairing closing up at 1.4296.

• The single currency initially fell against the greenback on Friday, after the US jobs report showed that the unemployment rate rose to a 26-year high of 9.7%, discouraging risk appetite.
  
• However a report also showed that non-farm payrolls declined by 216K, in August, an improved figure from the 276K revised drop seen in July.
  
• Reaction to this news was relatively muted reaction, but the single currency was supported as investors began to digest the information and realise the positive signs.
  
• The US stock markets were also supported by the data which in turn helped the euro as investors were encouraged away from their safe haven.
  
• Some analysts have speculated that the strengthening of the greenback following positive payrolls data could mark a further step towards the changing relationship of the dollar to economic data and risk sentiment.
  
• There is no economic data released today in the US as markets are closed, whilst in the eurozone, monthly figures on German factory orders are published at 09:30BST.

Despite mixed US non-farm payrolls data on Firday, sterling pushed higher against the dollar

Traders remained positive following mixed US payrolls data, which allowed the pound to climb to a high of $1.6409 on Friday before eventually closing at $1.6390.

• Early trading on Friday remained steady, with the pound edging up slightly against the dollar on strong European equities, as traders braced for important US employment figures.
  
• The data in the afternoon proved ambiguous though as traders tried to analyse the dual factors of improved non-farm payrolls, but greater overall unemployment, which rose to 9.7%.
  
• Following the news the pound did drop sharply from a daily high of 1.6386 but its losses were pared around the 1.63 level and it recovered to trade at pre non-farm levels as demand for the safety of the dollar was surprisingly limited.
  
• Analysts said that the worse-than-forecast rise in unemployment could prove a burden on household consumption and spell a very gradual recovery in the US, which may support the dollar value over the medium-term.
  
• There is no trading today on the US markets as it is their Labor Day, so movement is likely to be limited with the pair currently holding steady around the 1.64 level.

Sterling relinquishes Friday's gains against the euro

The pound climbed for the third consecutive day against the euro on Friday, supported by strong equities, to close at 1.1462, its highest point in over a week.

• Trading was particularly tight on Friday morning as investors were reluctant to put on big positions ahead of the August non-farm payrolls data in the US.
  
• However the data proved to be a mixed bag and had little impact on the pound / euro pairing, which continued to trade marginally in sterling’s favour throughout the day.
  
• The pound was supported though by a strong showing in the equity markets, which have held significant sway over the strength of the pound in recent weeks.
  
• Trading this morning has seen the pound slip from Friday’s highs, currently trading around 0.3% lower, with investors remaining wary of the UK’s recovery, following the words of the OECD that forecast a slower recover for Britain.
  
• In the eurozone today, data is released on Germany factory orders at 11:00BST, with analysts actually forecasting a 2.5% reduction from last month, whilst in the UK there are no major economic announcements.