A strong kiwi dollar shrugged off weak data from the US to post gains against sterling on Friday

Sterling relinquished gains against the kiwi dollar on Friday, as concerns mounted over the strength of the global recovery, with the price closing the week at 2.2269.

• Following the release of worse-than-expected jobs data in the US, risk adverse investors bought into dollar and yen havens on Friday, weakening the higher-yielding, ‘risky’ assets.
  
• However, the kiwi rebounded strongly in afternoon trading, as investors turned bearish in their sentiment towards the US recovery.
  
• The weak employment data added to concerns that the US recovery is struggling to take hold, and, after an initially flurry of dollar buying, many investors opted against the relative ‘safety’ of US assets.
  
• In trading this morning, the price has dropped back below 2.22 as the New Zealand currency tracked the strength of its aussie counterpart.
  
• Heightened speculation of an imminent rate rise in Australia has supported higher-yielding currencies this morning, and the kiwi could find further support as investors await expectations of improved New Zealand business confidence in a survey released today at 22:00BST.

Pound made gains against the aussie on Friday following weak US data

The pound advanced a further cent against the aussie on Friday, building on strong gains, as investors remained cautious following weak US employment figures.

• The US economy suffered 263,000 job cuts in September, which was far more than had been expected according to official data, sapping demand for ‘riskier’ assets.
  
• The pound advanced to over 1.84 as investors sold off the risky currency amid concerns that the US recovery may not be as robust as initially thought.
  
• However, the pound did cap its gains, as the US data dragged down European equities, with the FTSE falling below 5000 points, which dampened confidence in the UK currency.
  
• This morning, the Australian dollar as advanced strongly, up nearly a percent, as speculation mounts that the country’s central bank could raise rates later this week.
  
• Investors had been pricing in a possible rate move in early November, but the probability of a move toward 3.25 is now possible as early as tomorrow’s meeting, following comments from two Australian media columnists.

The euro posted gains against the US dollar on Friday and has reached back over 1.46 this morning

The single currency shrugged off worse-than-expected US non-farm payrolls data to post gains, closing up 0.2% at 1.4574.

• Date revealed that the US economy lost 263,000 jobs in September, which was more than had been expected, according to official non-farm payrolls figures.
  
• The Labor Department revealed that US unemployment rate rose to 9.8%, fueling fears that the labour market could undermine economic recovery.
  
• The euro initially dropped sharply to a three-week low of 1.4485 on the release of the U.S. payrolls report, as investors were encouraged to the relative safety of the greenback.
  
• However, dollar gains were modest, and the single currency was able to rebound strongly, climbing near $1.46, as analysts suggested caution in buying the US currency amid signs that the recovery could stall.
  
• Analysts noted that trading is often volatile following the highly anticipated US monthly jobs data.
  
• The dollar has fallen against the euro today, losing 0.3%, after the G7 finance chiefs refrained from calling for measures to stop the U.S. currency’s decline.

A rise in risk aversion weighed on the pound on Friday, supporting dollar gains

The pound slid against the dollar on Friday, completing its third straight weekly decline, as demand for the haven currency found support from weak US employment data.

• In early trading, risk appetite was down, with investors taking up defensive positions ahead of an expected rise in US unemployment figures.
  
• However with weak data already priced into the market, the pound avoided a further sell off after data confirmed an increase in jobless figures that brought overall unemployment in the US to 9.8%.
  
• The data did trigger a sharp fall in major stock indices, with traders concerned that the global recovery is struggling to find momentum.
  
• However, the pound was able to pick itself up from a four-day low of 1.5807 against the dollar, clawing back some of its losses, as European equities rallied slightly, to close the week at $1.5944.
  
• The price is holding steady this morning, having made initial gains after the G7 meeting over the weekend brought no talk of re-evaluating the strength of the US dollar.

Sterling lost ground against the euro on Friday, and has dipped below 1.09 in trading this morning

Sterling gave back recent gains against the euro on Friday, losing 0.3% as risk aversion weighed heavily on the fragile UK currency.

• Sterling struggled in the morning as investor’s booked profits after the pound’s gains against the euro on Thursday, but trade was initially range bound ahead of US payrolls data.
  
• The pound also failed to gain traction after a Nationwide housing market survey showed prices were steady on the year in September, the first time since March that prices have not fallen on a year-on-year basis.
  
• In the afternoon, US payrolls data disappointed expectations, justifying the rise in risk aversion in the market and sending global equities spiralling further downward.
  
• Indeed, the FTSE 100 went back below the psychological 5000 level, which was particularly damaging for the pound
  
• In trading this morning the price has continued to climb in the single currency’s favour, though sterling may find support should UK services meet expectations and reveal a stronger month on month figure at 09:30BST.